BUSINESS BEFORE QUESTIONS

Manchester City Council Bill [ Lords] and Bournemouth Borough Council Bill [ Lords]

Resumption of adjourned debate on Question (15 January),
	That the promoters of the Manchester City Council Bill [ Lords] and Bournemouth Borough Council Bill [ Lords ], which were originally introduced in the House of Lords in Session 2007-08 on 22 January 2007, should have leave to proceed with the Bills in the current Session according to the provisions of Standing Order 188B (Revival of bills).

Hon. Members: Object.
	 The debate stood adjourned; to be resumed on Tuesday 21 April at  Sev en o'clock.

Canterbury City Council Bill, Leeds City Council Bill, Nottingham City Council Bill and Reading Borough Council Bill

Resumption of adjourned debate on Question (15 January),
	That the promoters of the Canterbury City Council Bill , Leeds City Council Bill, Nottingham City Council Bill and Reading Borough Council Bill, which were originally introduced in this House in Session 2007-08 on 22 January 2008, should have leave to proceed with the Bills in the current Session according to the provisions of Standing Order 188B (Revival of bills).

Hon. Members: Object.
	 The debate stood adjourned; to  be resumed on Tuesday 21 April at Seven o'clock.

ORAL ANSWERS TO QUESTIONS

TREASURY

The Chancellor of the Exchequer was asked—

Credit Insurance

Michael Jack: What assessment he has made of the effect of the availability of credit insurance for industry on the prospects for economic recovery.

Yvette Cooper: About 20 per cent. of lending between businesses is generally covered by trade credit insurance. There is evidence that credit insurers are withdrawing insurance as part of the credit crunch, which is increasing the risks for those companies that use it, and the Government are in discussion with trade credit insurance companies about ways to give business more support.

Michael Jack: Welcome as it is to learn from the Chief Secretary that the Government are in dialogue about this subject, I ask her to consider the situation of a small company in my constituency. The premium for its trade credit insurance has risen from £7,000 to £21,000 a year, and that is unaffordable. It had hoped that in the light of the announcement by the Under-Secretary of State for Business, Enterprise and Regulatory Reform, the hon. Member for Dudley, South (Ian Pearson), that the Government were working on a scheme to underpin trade credit insurance, something would have been announced by now. When will the Government formally address this problem and provide these companies with the help they need?

Yvette Cooper: We are looking at this issue, and the right hon. Gentleman is right to raise it. Much of the market is not covered by trade credit insurance, but this is a real pressure for those businesses that are, which includes many small businesses. He will be aware, however, that there is a private trade credit insurance market, and it is also important to ensure that we protect the taxpayers' interests. He is calling for more action, and I respect that position and think it right that we try to do more, but he should also be prepared to put money behind that, and that is something that his party has persistently refused to do.

John McFall: May I remind the Chief Secretary that in November I wrote a letter to the Chancellor and Lord Mandelson after discussions with Marsh insurers about credit insurance, and the situation is still precarious, so I think further negotiations need to take place in that area? Dare I also mention the remarks of the Governor of the Bank of England to the Treasury Committee the other day? He said that he would not rule out targeted measures, whether in terms of the labour market or corporate credit. I think targeted measures are still necessary in terms of corporate credit.

Yvette Cooper: My right hon. Friend is correct to say it is right to support the economy at this difficult time. That means providing support for businesses to deal with the pressures they are facing as a result of the global credit crunch, and particularly also support for those who are losing their jobs. That is why we are putting more than £1 billion of additional funding into, for example, helping those who are losing their jobs—investment that, sadly, is continuously opposed by the Conservative party.

Michael Moore: For many world-class textile businesses in my constituency, the lack of credit insurance is now a very serious issue. In addition to the monitoring that the Chief Secretary is doing, will she look at the increasing amount of information that we are getting to the effect that the banks are restricting their own facilities and their lending to these companies because there is no credit insurance, which means these businesses are now feeling a double whammy from which they are getting no relief at all?

Yvette Cooper: The hon. Gentleman makes an important point, and that is exactly why we are in detailed discussions with the trade credit insurance companies, and also why we have been setting out a range of measures with the banks to support increased lending. The global credit crunch means there has been a big drop in foreign bank lending, for example, in the UK. Nevertheless, it is right to do everything we can to increase lending and support, which is why we now have legally binding commitments with the banks that have signed up to the asset protection scheme, in order to increase lending this year by tangible amounts.

Barry Sheerman: Does my right hon. Friend agree that dialogue is not enough? There are good firms in our region that will be going out of business if we do not get help to them soon. The textile industry in Yorkshire particularly needs help, and it needs it now—if these businesses are supported for six to nine months, they will survive and flourish. We must do something quickly.

Yvette Cooper: My hon. Friend will be aware of the range of additional support that we have already provided for businesses, because it is right to do so to get them through the credit crunch. For example, 90,000 businesses are now benefiting from being able to defer their tax payments to the tune of more than £1.7 billion. That has been opposed by the Conservatives, but also £350 million of loans—

Mr. Speaker: Order. The right hon. Lady has made mention of what the Conservatives are doing in every one of her replies. I do not want that; what I am looking for is a ministerial reply.

Hon. Members: Hear, hear.

Yvette Cooper: Opposition Members are obviously pleased not to hear reminders about their policies, but—

Mr. Speaker: Order. I call Anne McIntosh.

Waste Disposal

Anne McIntosh: What discussions he has had with the Secretary of State for Environment, Food and Rural Affairs on the implications of Government policy on the private finance initiative for contracts for waste disposal.

Angela Eagle: Government policy, as announced on 3 March, is to ensure that vital infrastructure projects proceed as planned, supporting jobs in the economy and preparing for full recovery. In total, £13 billion of public investment in procurement will be safeguarded by the Government's action. That protection will ensure the future of a broad range of public infrastructure projects, including £3.5 billion of waste treatment and environmental projects.

Anne McIntosh: But is this—a time of credit crunch and the most severe recession that this country has ever faced—the best time to be inviting private finance initiatives? Why are the Government hiding behind private finance and why are public authorities having to explain what the benefits of energy from waste and other forms of incineration are? Why cannot the Government come out fighting with their own financing of these initiatives and explain to the public what the benefits or disbenefits of these initiatives are?

Angela Eagle: The announcements we made on 3 March will ensure that temporary problems experienced in the debt market will not put at risk £13 billion of vital investment in infrastructure, which will lead to the building of new schools and new hospitals, as well as jobs in waste procurement. I am not sure whether the hon. Lady is arguing that we should just abandon that and lose all the economic activity, jobs and support that goes with it—it sounds as if she is.

Julie Kirkbride: Why are the Government not open about the level of public sector finance initiatives, which should now be included in the national debt? If they were more open about that, we could see exactly the extent to which they have mortgaged our future.

Angela Eagle: To the extent that public finance initiatives have helped to increase and renew our infrastructure, they are to be welcomed. The hon. Lady knows that that is about 10 per cent. of capital investment, and that it has created jobs and new buildings. In fact, we have mended not only the roof, but the whole inside of the building, which was crumbling when we inherited it in 1997. Public investment is a good thing. It has completely renewed our infrastructure, and that means that we have modern and more efficient, effective and productive infrastructure for the future. I would have thought that she would welcome that.

Dennis Skinner: Is the Minister aware that there is a new waste disposal unit in Bolsover, on the old Coalite site? It is doing exceptionally well; there were queues there on Sunday. I propose that the shadow Business Secretary get hold of the Tories' inheritance tax plan and dump it in the waste disposal unit at Bolsover.

Angela Eagle: Our ability to deal with the complex problems caused by waste gets ever more sophisticated; my hon. Friend has come up with an intriguing new way of recovering energy from waste.

Credit Provision

Bernard Jenkin: What further steps his Department plans to take to encourage banks to provide credit to businesses.

Alistair Darling: The Government will continue to take whatever action is needed to maintain the stability of the financial system and to kick-start credit in the economy.

Bernard Jenkin: There has now been a credit crunch in the economy for 18 months. The Government have introduced a great many measures, but is there any evidence that they are working? Has not all the extra liquidity that the Government have thrown at the banks been insulating them from the need to make the changes to and the clarifications of their balance sheets? Is it not the case that they will not start lending to each other until they trust each others' balance sheets, and that the Government have not actually forced them to come clean about what is on their balance sheets?

Alistair Darling: The restoration of trust in the banking system is essential; it is a precondition of fixing the problems in the wider economy, here and across the world, and it is absolutely necessary. The second thing to say to the hon. Gentleman is that it was necessary, as I believe most people accept, for us to recapitalise the banks in October. It was also necessary to go further than that and to help to deal with the problem that we face of these banks having on their books assets for which there is no market or whose value has been much reduced. That is why we introduced the asset protection scheme—the United States Government have announced something similar in its intent earlier this week, and other countries are doing that too. We have to make sure that we fix the banking conditions, because that is a precondition of sorting out the wider problems in the economy. Our approach is having an effect and will continue to have an effect. There is no overnight fix, but we are doing the right things to get lending and credit flowing in the economy, as well as supporting the wider economy and protecting jobs.

Mark Durkan: Does the Chancellor accept that some people are finding a significant difference between the headline funds that the banks announce are available to support businesses and the amount of credit actually facilitated? We have banners in banks in Northern Ireland saying, "Lending isn't ending", but the message from business is, "Credit? We can't get it!" That comes from sound, reliable businesses. Will the Chancellor seek a report from the lending panel on what exactly is happening with the banks in Northern Ireland in terms of support for business?

Alistair Darling: Yes, and we will continue to do that. I can understand the frustrations of businesses and individuals when they find that a credit line that was available is no longer available, or that the price being charged has increased. Our objective in everything we are doing to support the banking system is to get credit flowing in the economy again. As I said a moment ago, that is essential. We will continue to monitor what banks are doing. There is some evidence that in several cases credit is now available, although as we continue through one of the severest downturns we have seen—the House will have seen the figures from Japan and Germany earlier this week, which show a significant downturn—it is necessary that we maintain the course that we have set and do everything that we can to get credit flowing again. That is very important.

Julian Brazier: Nobody doubts the Chancellor's commitment on this issue, but in drawing parallels with the US recapitalisation, will he accept that because their preference stock was at 5 per cent. while ours was at 12 per cent., US banks have an incentive to rebuild their businesses, whereas British banks have an incentive to minimise their exposure to Government recapitalisation?

Alistair Darling: I am not sure whether the hon. Gentleman has noticed, but in the past six weeks we have converted the preference shares that we held in the RBS Group and the Lloyds Group into ordinary shares, because they needed the additional capital. The Financial Services Authority's requirements were quite clear about that. I welcome what the hon. Gentleman says about supporting the banks, but what we are doing in supporting the banking system is complemented by what we are doing to support the wider economy.
	I know that there is a difference of view about whether there should be any fiscal stimulus, but a substantial amount of money has gone into the economy, on which the Governor of the Bank of England fully agrees with us. I also agree with the Governor that it is necessary to continue to take action to support our economy. In particular, it is necessary to do everything we can, when people face losing their jobs, to get them back into work. That is one of the big lessons that people should have learned from what happened in the 1980s and 1990s.

Jim Devine: Will my right hon. Friend consider placing a cap on interest rate charges for credit? For some store cards, interest is 26 per cent. APR and some companies charge as much as 182 per cent. as legalised moneylenders. That is obscene at a time when interest rates are below 1 per cent.

Alistair Darling: I do not think that a generalised cap or Government regulation of interest rates would work. I have great sympathy with what my hon. Friend says about the very high interest rates imposed by some unscrupulous lenders, and I know that he has done a great deal to try to address those problems. People have to remember, however, that if we impose controls and try to restrict lending, it comes at a wider cost to individuals, businesses and the economy. It is important to tread the fine line between sufficient public regulation, supervision and controls to protect the public interest, and stopping the flow of credit on which everything in our economy depends.

Stewart Hosie: The minutes from the Bank of Japan tell us that Japan's quantitative easing programme was expected to encourage the banks to provide more credit to business, but the evidence is that bank lending reduced over the period of quantitative easing. What can the Chancellor say today to give us more confidence that the UK's version of printing money will have the right result and encourage the banks to provide more credit?

Alistair Darling: Quite simply, in the 1990s Japan did not address the underlying problem in the banking system. It did not put in enough capital and did not deal with the assets that had gone bad, and until one addresses those problems anything else that one might do will not have the full effect that is hoped for. The Japanese are now quite clear about what went wrong in the previous decade and that is why most countries are now at pains to avoid it. The very fact that Japanese exports have gone down by nearly 50 per cent. demonstrates the extraordinary circumstances that we face. When a country such as Japan is facing such problems, there is all the more reason for us not only to take action to deal with the bank problem and to sort that out, but to take whatever action is necessary to support the economy through fiscal stimulus. We have given the Bank of England additional fire-power to put more money into the economy, because that is essential if we are to protect jobs in quite extraordinary conditions across the world.

Ken Purchase: I am quite clear that banks should not be lending to businesses when underlying weaknesses are not being properly addressed. However, it seems to me that in my constituency at least many decent businesses, without underlying weaknesses, are told when they apply for credit that they have to cover that advance many times over—sometimes twice—with securities. I believe that the banks have to take some of the risk themselves, rather than trying to transfer the whole amount to small business owners, who have wives, families and so on to keep. It is quite unrealistic to expect that level of cover from ordinary small businesses when advancing credit.

Alistair Darling: If my hon. Friend would let me have a note of some of the problems that his constituents have encountered, I would be happy to look at them. I agree that as part of the process of restoring trust in the banking system we have to be clear about banks' responsibilities as well as the responsibilities of individuals and businesses. If someone takes out a loan, they have to be clear that they can repay it. Equally, banks have to be responsible in their lending and ensure that they are realistic and reasonable about the conditions that they impose. That is very important and it is all part of restoring trust in the system, which I regard as absolutely essential.

Peter Tapsell: Does the Chancellor agree that with the declining prospect of growth in the economy, the banks are faced with an inevitable deterioration in the quality of their loan books, so that far from increasing their loans to businesses, they are likely to be seeking the whole time to increase their capital? How will that problem be overcome?

Alistair Darling: The hon. Gentleman raises a quite reasonable point. All over the world, we have this problem. We need to ensure that banks strengthen their capital position, because in the long term that is essential. Of course, if banks did that and there was no other intervention, there would be less credit in the economy and the economy would shrink further. The result would be that the bank assets that are currently impaired would become even worse. That is why we have not only taken action to recapitalise the banks—in the case of RBS and Lloyds Group we have put additional capital in—but put in place schemes such as the credit guarantee scheme, which is working very well, the special liquidity support system, which has provided liquidity for the banks, and, in addition, the asset protection scheme, which, as I have said, will go down a similar road to the scheme in the United States. I am sure that the hon. Gentleman recognises that, as he is in a minority in his party in that he sees the point and the reason behind Government intervention in such extraordinary circumstances. Government intervention is absolutely necessary to complement the process that he and I agree has to take place if we are to maintain credit in the economy.

Philip Hammond: The simple way to get the banks lending to business again is the Conservatives' national loan guarantee scheme. Yesterday, in Prime Minister's questions, the Leader of the House criticised the scheme, claiming that there was no money behind it. The Chief Secretary said much the same thing a few moments ago. For the record, will the Chancellor confirm what the Economic Secretary told the House about the Government's guarantee schemes on 14 January? He said:
	"We expect the measures to be run on a break-even basis".—[ Official Report, 14 January 2009; Vol. 486, c. 220.]
	He said that for a very good reason, because the premiums that are being charged are expected to cover the losses. There will be no additional cost to public expenditure from those schemes. Is it not the truth that the Government's only sustainable objection to the national loan guarantee scheme is that they did not think of it first? British businesses are suffering because the Prime Minister puts his political sensitivities ahead of their business needs.

Alistair Darling: With your forbearance, Mr. Speaker, I think that I can answer that quite shortly. When the loan guarantee scheme was announced by the shadow Chancellor, he said that
	"it does not add to public expenditure" —[ Official Report, 18 December 2008; Vol. 485, c. 1228.]
	On 11 March, the shadow Business Secretary said, with exemplary candour, that
	"the taxpayer will take some of the hit."
	How on earth does one square the Conservatives' position that they would spend nothing extra with the fact that this scheme, even if it were workable, would cost the taxpayer money? That just shows the nonsense of the Conservative position.

Equitable Life

Annette Brooke: What progress has been made by the Chadwick review into compensation for Equitable Life policyholders.

Ian Pearson: Sir John Chadwick has begun the work that the Government asked him to undertake on aspects of the ex gratia payments scheme that was announced by the Chief Secretary to the Treasury on 15 January. The Government will keep the House updated and report back on progress at regular intervals.

Annette Brooke: The Government's position has been described as
	"shabby, constitutionally dubious and procedurally improper".
	It is clear that the parliamentary ombudsman does not think that injustices will be fully remedied. What assurances will the Government give that my constituents and other Equitable Life policyholders who have clearly suffered injustices will get justice delivered with speed, clarity and transparency?

Ian Pearson: I am very disappointed that the Public Administration Committee should choose to obscure the real help that it accepts the Government's payments scheme will deliver under extreme headlines, seemingly driven by an uncritical acceptance of the findings of the ombudsman's report and by its unjustifiable and irresponsible characterisation of the manner of the Government's response.  [ Interruption. ] As a Government, we do not depart lightly from any of the ombudsman's findings, but— [ Interruption. ]

Mr. Speaker: Order. The hon. Gentleman is in order.

Ian Pearson: The Government do not depart lightly from any of the ombudsman's findings, but in such an important and complex case we have a clear duty to the taxpayer to ensure that our response is informed by a proper and comprehensive consideration of her report. That is what we have done and, as I have indicated previously, we want to move forward with an ex gratia payment scheme just as quickly as possible. We are talking to Sir John Chadwick about the advice that he is providing.

Patrick Cormack: Is the Minister aware that he has just made one of the most shameful statements to have been made from that Dispatch Box in many years? He has rubbished a Committee presided over by one of his own greatly respected colleagues, and discounted the unprecedented second letter from the ombudsman that we all received this week. He has had no support from the Benches behind him, as not a single Labour Member has risen to echo his words. He should be deeply ashamed of himself, because he is bringing the Government and the whole system into disrepute.

Ian Pearson: I have a lot of respect for the hon. Gentleman, who has a very long track record of upholding standards in this House, but we have departed from the ombudsman's findings only where we have clear and cogent reasons for doing so. We have applied scrupulously the terms of the Parliamentary Commissioners Act 1967, as interpreted by the Court of Appeal in the Bradley judgment. For no other reasons have we departed from those findings. I have to say that I remain very disappointed indeed that the PAC does not appear to have understood some of the arguments that we have made to it.

Mark Field: May I associate myself entirely with the words of my hon. Friend the Member for South Staffordshire (Sir Patrick Cormack)? I think he speaks for many people in the House, including many of the silent Back Benchers behind the Minister. What is the Minister now saying to all of our constituents? They are not unreasonable, and do not necessarily expect to get a share of the £4 billion that is being proposed, but are the Government simply waiting for many constituents across the country who relied on Equitable Life literally to die before there is any chance of getting any money on their behalf? Does he not find that a disgraceful state of affairs?

Ian Pearson: No, we are not saying that. We are saying that we want to move forward with introducing an ex gratia payment scheme as quickly as possible to help those who have suffered disproportionate impact as a result of losses through Equitable Life. We shall continue to do that. The fact that we have a disagreement with the Public Administration Committee will not deflect the Government from moving forward with all speed and providing a remedy for Equitable Life policyholders who have suffered disproportionate impact.

Several hon. Members: rose —

Mr. Speaker: Order. Condemning the Minister's reply is not what this is about—it is about asking a supplementary on the subject. I am sure Sir Nicholas Winterton will be able to do that.

Nicholas Winterton: I hope, Mr. Speaker, I do not let you down.
	Is the Minister not aware that the way that Equitable Life policyholders are being treated is viewed—by the public, and not just the policyholders themselves—as another example of the way the Government treat people who have been responsible and prudent? Here are people who have tried to save for their retirement. The reports produced by the ombudsman have, in a way sadly, been critical of the Government, so is it not time that the Government speeded up the process to help people such as those who are losing out from virtually negative interest on their savings under the credit crunch, and to give them the benefit of their prudence and responsibility?

Ian Pearson: The ombudsman herself admitted that the issue was not clear cut. The hon. Gentleman will be well aware of the findings of the Penrose report, which said that the company was largely responsible for the demise in the situation. We will continue to move ahead with all the speed we can. We have asked Sir John Chadwick to provide us with advice; we want to introduce a scheme and we want to make sure that we can offer a remedy to Equitable Life policyholders. There is a technical dispute between the Public Administration Committee and the Government, because we clearly do not agree with its report and we shall respond in due course.

Mark Hoban: That was an extraordinary attack on an Officer of the House and a Committee of the House, and the Minister's comments will be noted across the country. They typify the Government's approach to the whole issue. At every step on the way, the Government have sought to block, frustrate and delay justice for Equitable policyholders. On Saturday,  The Daily Telegraph nailed them completely. An early draft of the Treasury response to the ombudsman's report said:
	"Sir John will aim to provide his final advice to Government by June 2010."
	Is it not time for the Government to stop their shabby treatment of policyholders and give them a clear timetable for justice?

Ian Pearson: I and the Government have every sympathy for Equitable Life policyholders who have suffered genuine losses as a result of the failure of regulation, for which we have apologised. I have still not heard an apology from the Opposition for the period when they were responsible with regard to public bodies. Let us be clear. We have said all along that it is not normal practice for the Government to compensate for regulatory failure, and that is not the response just of this Government—it has been the response of successive Governments.
	With particular regard to the date the hon. Gentleman gave, let me be very clear in response: we have said that we want Sir John Chadwick to advise us as quickly as possible and we want to make sure that we can introduce a payment scheme and make payments as quickly as we have the evidence, but we are talking about spending taxpayers' money, and we have to have regard for the public purse. We have to do the right thing in the right way, and we will do that as quickly as possible.

Economic Growth

Nigel Evans: What his most recent forecast is of economic growth in the UK in 2009-10.

Mark Harper: What his most recent forecast is of economic growth in the UK in 2009-10.

Alistair Darling: I will update the House at the Budget on 22 April.

Nigel Evans: Well, a lot of jobs will be lost between now and then. Over the last several weeks, since the recession began, 6,500 jobs in east Lancashire have gone, and the chamber of commerce predicts that another 5,000 jobs will go. In my constituency, between Fort Vale Engineering, Fraser Eagle and Ultraframe, 200 jobs have either gone or are under threat of the axe. Will the Chancellor tell us how many jobs he believes will go in east Lancashire simply because of the business rate increase now facing many small to medium-sized enterprises? Does he not see the absurdity of pumping huge sums of money into the banks that will then have to be borrowed by some of those small to medium-sized enterprises—if they can do so—simply to pay for the business rate increases he is imposing on them?

Alistair Darling: The hon. Gentleman said that he was concerned about people who lose their jobs, and he is right to be concerned about them. That is why we have allocated just over £1 billion to the Jobcentre Plus network to help people who lose their jobs to get back into work as quickly as possible. It is still the case that most people who lose their jobs manage to get back into work within three months. Of course, that means spending money—something that he and his colleagues are against. I am aware of the concerns that have been expressed about business rates, but again, what the hon. Gentleman is asking for involves spending money, and his Front-Bench colleagues give the distinct impression that they would not spend any more money at all.

Mark Harper: The Chancellor mentioned unemployment; in my constituency, it has risen by 18 per cent., according to the last set of figures. There are very few jobs advertised in the jobcentre, and there are 21 jobseekers for every job that it advertises, so my constituents will be looking very closely at the Budget. Did the Governor of the Bank of England not let the cat out of the bag when he pointed out that our fiscal position is so bad, our debt so high, and the Chancellor's inheritance from his predecessor so bad, that the Chancellor's hands are tied, and he will not be able to deliver a substantial fiscal stimulus in that Budget?

Alistair Darling: That actually was not what the Governor said. Indeed, he made the point, in his evidence to the Treasury Committee, that he thought that measures to help people get back into work were a good thing, and ought to be supported. The point that I was making—I will make it to the hon. Gentleman as well—was that if we are to help people get back into work and retrain, and if we are to help them match with jobs in the economy, it will mean spending money. The lesson from the recessions of the 1980s and 1990s is that if we do not spend the money—if we do not intervene for two or three years—an entire generation will effectively be wiped out. We must avoid that at all costs. That is why the Governor and I are totally agreed that the stimulus that I announced last November was necessary. That is why both of us agreed, at the G20 meeting of Finance Ministers and central bank governors a couple of weeks ago, that we needed to do whatever was necessary, for as long as is necessary, to support the economy.
	Of course, as I have said on many occasions, substantial sums of money are being put into the economy through the measures that I announced in the pre-Budget report, and through the additional fire-power that I have given the Bank of England to get credit going in the economy. Both those things are absolutely essential, and we have to make sure that they work their way through. As the Governor himself said—and I agree—we also have to make sure that, if it is necessary, we continue to do more when it comes to measures such as putting people back into work. It is nice to have the support of the hon. Members for Ribble Valley (Mr. Evans) and for Forest of Dean (Mr. Harper); perhaps they could have a word with their Front-Bench colleagues.

Nick Ainger: May I agree wholeheartedly with what the Chancellor said? I was on the Treasury Committee when the Governor said the words that my right hon. Friend has just repeated. May I commend to my right hon. Friend the submission produced by Professor "Danny" Blanchflower and David Bell of Stirling university, which puts forward suggestions to address youth unemployment? In the summer, 700,000 young people will leave school and university; we need to tackle those numbers. Will my right hon. Friend look at the report, because it suggests good ways of tackling the problem of growing youth unemployment?

Alistair Darling: I have indeed seen Professor "Danny" Blanchflower's suggestions, and I have spoken to him as well.  [Laughter.] Rather than laughing about the matter, most people in the House ought to be concerned, at a time when we can see that the unemployment figures have been rising, that we do everything possible to get people back into work. The lesson from the past is that that is necessary not just for the long-term unemployed. It is especially necessary for young people, to ensure that they get back into the workplace as quickly as possible. However, I repeat that it means that at some stage we have to be prepared to spend the money to back that up. My view is that it is money well spent, because the cost of doing nothing, which is what the Opposition urge us to do, would be far, far greater.

Andrew Love: One consideration is the dramatic drop in world trade over the past six months. What action will my right hon. Friend be taking at the G20 to try to reassure the international community, so that we can get world trade moving again?

Alistair Darling: I agree with my hon. Friend. The fall in world trade is one reason why industrial production is falling. It is interesting that, in the exchange of letters that I had with the Governor of the Bank of England, he made the point that in 54 of the 57 countries for which we have data, falls in industrial output were seen over the last quarter of 2008. That has had a devastating effect on economies, particularly in the far east.
	We need to make sure that we get world trade going, which is why the resumption and conclusion of the Doha round of trade talks is important—and that will feature next week at the G20. It is also necessary for countries around the world to do everything that they think is right and appropriate to boost their own economies. Nobody is saying that they need to turn up next Wednesday with a budget on the table, but we are saying that if countries act together the effect will be far greater. When recession is affecting or threatening countries across the world, the need for countries to act together is essential, which is why next week is an important step along the way.

Michael Fallon: Why did it take the Governor to warn the Prime Minister that this country simply cannot afford to borrow any more money? Why does the Chancellor not stand up for taxpayers' interests, resist the banging on the wall from his neighbour next door, and start the long haul of getting our public finances under proper control?

Alistair Darling: I would say two things to the hon. Gentleman. First, the International Monetary Fund noted in its recent report that many countries entered this problem
	"with greater fiscal space to expand".
	It noted that Canada, China, France, the UK and the US were such countries, so we are in a place where we can provide help for the economy. To put it another way, if we had not done so—if we had taken £20 billion out and withdrawn the power that we have given to the Bank of England to ease credit—the effect on the economy would have been absolutely harmful and very damaging, especially to jobs and the future prosperity of businesses.
	I made the point in the pre-Budget statement last year that, just as it is necessary to support our economies now, all countries need to live within their means over the medium term. That is why I announced measures to raise money in the pre-Budget report. It is important—and no one should be in any doubt about this—that, yes, we need to take measures now, as I have said, as the Governor has said, as the Prime Minister has said, to support our economy, but all of three of us have also made the point that it is necessary to make sure that in the longer term we have a sustainable position and that all countries live within their means. That may mean making some hard choices, but it is necessary.

Lindsay Hoyle: My right hon. Friend is well aware of the difficulties. He has heard about manufacturing in Lancashire, and we have just lost more jobs at Leyland Trucks. We ought to look at how we can protect manufacturing for when the economy goes into growth, and the best way of doing so is through a short-term working subsidy. Will he look at that, and if he is looking at how we can fund it, he can always end the VAT cut early so that that much-needed measure can put the impetus back into manufacturing?

Alistair Darling: I agree with my hon. Friend that we need to do whatever we can to protect jobs or, where jobs are lost, to get people back into work. I also agree that it is necessary as far as possible to do what we can to help where we think that businesses have a viable future. I do not agree with the point that he made in relation to VAT, but I do not think that he expected me to do so.

Greg Hands: Earlier this week, the former Cabinet Minister, the right hon. Member for North Tyneside (Mr. Byers), said that the VAT cut had "run its course" and should be reversed. Does the Chancellor agree?

Alistair Darling: No, I do not, because I think that putting £12.5 billion into the economy and doing it immediately was necessary. We are also—and I am grateful to the hon. Gentleman for allowing me to say this—taking other steps that will help the wider economy. Basic rate taxpayers will see a reduction in their tax, starting on 6 April. We have increased child benefit for the oldest child, and for other children as well. We have brought forward, too, a payment of £60 for pensioners, and the state pension itself will go up in April, so we are taking a range of measures to help. As for VAT, perhaps the hon. Gentleman should have a word with the shadow Business Secretary, who supported the reduction in VAT. Increasingly we are hearing a lot more sense and a lot more experience from that direction than we are from the shadow Treasury Front Bench.

Automotive Industry

David Drew: What recent discussions he has had with the Secretary of State for Business, Enterprise and Regulatory Reform on assistance for those on short-time working in the automotive industry.

Stephen Timms: The tax credit system is particularly effective in delivering immediate help to families whose income falls—for example, as a result of short-time working. We have worked closely with the Department for Business, Enterprise and Regulatory Reform on the Government's automotive assistance programme.

David Drew: In a previous exchange, my hon. Friend the Member for Chorley (Mr. Hoyle) mentioned the need for wage compensation for those on short-time working. In Stroud we have worked up quite a sophisticated training package with both Delphi and Renishaws, and I thank the South West of England Regional Development Agency, Gloucestershire First and Unite trade union for that. The missing link is the need to recognise that people are putting their own time and money into the training package. If the Government could provide some additional funding for that, that would be important. I know that there is a paper before the Cabinet. May we have some clarity and some progress on this?

Stephen Timms: I am grateful to my hon. Friend and he is right to draw attention to the range of measures that are in place to support the automotive industry. I point out to him again the benefits of the tax credit system—for example, for someone who is earning £400 a week, with two children. If their income falls by £40 a week, perhaps as a result of short-time working, the tax credit award could well go up by £15 a week. So there is real and immediate help from the tax credit system to people in the position that my hon. Friend describes. We are looking at other options. We are looking, for example, at the possibility of a wage subsidy scheme that we have seen elsewhere, to see whether that could add to the real help that we are already giving. The car industry is making good use of the Train to Gain support of up to £100 million, which my hon. Friend mentioned. We are giving the help that is needed.

Topical Questions

David Hamilton: If he will list his departmental responsibilities.

Alistair Darling: My responsibilities remain as I set out on previous occasions.

David Hamilton: My right hon. Friend will be aware of the crisis that is facing pubs and clubs throughout the country. My constituency cannot be any different from anywhere else, and every week a pub or a club is put under pressure. When reviewing the Budget, will the Chancellor look into the duties placed on pubs, as opposed to the loss leaders in supermarkets, and consider the possibility of changing the duty on draught beers, ciders and lagers, which could help them? Will he also take a good kick at the breweries and tell them that they should reduce the rates that pubs have to pay?

Alistair Darling: My hon. Friend raises an understandable concern for pubs throughout the country. He will know that the number of pubs in this country has been declining pretty steadily over the past 20 years or so. He is right to say that there are many factors that influence the price of beer that the customer pays in the pub. That depends not just on duty but on charges made, in many cases, by brewers that are tied. I met representatives of the brewing industry and the industry generally fairly recently to discuss these matters and, as ever, I will keep them under review.

George Osborne: I notice that in previous answers the Chancellor has avoided directly addressing the comments of the Governor of the Bank of England to the Select Committee on Tuesday. The Governor said:
	"the fiscal position in the UK is not one that would say, 'Well, why don't we just engage in another significant round of fiscal expansion?'"
	In one word, will the Chancellor tell us whether he agrees with the Governor of the Bank of England—yes or no?

Alistair Darling: As I have said on a number of occasions this morning, the Governor and I are in complete agreement in relation to the fiscal stimulus that I announced in the pre-Budget report last year. We are in complete agreement about the declaration that we both signed up to at the G20 meeting in Horsham a couple of weeks ago, when we said that countries needed to do whatever was necessary for as long as necessary. I also agree with him when he says specifically in the same evidence to which the hon. Gentleman refers that he would not rule out targeted and selected measures that help people faced with unemployment, something that the hon. Gentleman has turned himself against. The difference is not between me and the Governor—far from it. It is between me and the hon. Gentleman, who opposes doing anything to help people in these unprecedentedly difficult conditions. It is he who has the problem, not us.

George Osborne: The Chancellor knows full well that the question is about a potential second fiscal stimulus in the Budget which the Governor of the Bank of England was warning against and on which the Chancellor has yet to express a view. Is it not a defining moment in the history of the Government's handling of the recession when the Governor of the Bank of England pulls the rug on the entire fiscal approach pursued by this Government? We have the truly humiliating position of a Prime Minister lecturing Latin American economies about fiscal probity while the Governor of the Bank of England cuts up his credit card back home. Can I ask the Chancellor again, very specifically, does he agree with the Governor of the Bank of England that
	"the fiscal position in the UK is not one that would say, 'Well, why don't we just engage in another significant round of fiscal expansion'"?
	If there is no agreement between the Chancellor, the Governor of the Bank of England and the Prime Minister, what hope is there for any confidence that the Government can pull us out of this recession?

Alistair Darling: As ever, the hon. Gentleman is talking nonsense and he knows it. I have made it very clear—and the Governor and I have discussed this on many occasions—that it was and remains necessary for us to take the action necessary to protect jobs and get credit flowing again in the economy. The hon. Gentleman opposes that. I believe that it is right, because I believe that the Government should be in the business of helping people through what is an unprecedentedly difficult period.
	In relation to this country's position, the International Monetary Fund itself, as I said, has noted that we and other countries were able to put in place a stimulus. It called for countries to take action together. We have done that, but again it is something opposed by the hon. Gentleman. He has absolutely no policies, prescriptions or suggestions as to how we should deal with these things. Indeed, the only policy that he has, in relation to inheritance tax—a policy that he claimed was funded—was undermined yesterday when the shadow Business Secretary, someone who does have experience, said that he had no idea how much money could be raised by the proposals. Is that not another example of experience on the part of the Business Secretary triumphing over the youthful impetuousness that we see opposite?

Tony Lloyd: My right hon. Friend will be aware that the Financial Services Authority's compensation scheme has refused to recompense the charitable scheme of the Christie cancer hospital in Manchester for the £6.5 million that it lost when the Icelandic banks crashed. Will it be possible to urge the FSA to look once again at the unique position of charities—not, I recognise, only one charity? They are not equivalent to local authorities or individuals, but represent the many small donations of thousands upon thousands of individuals.

Alistair Darling: I fully understand my hon. Friend's point about the Christie hospital and a number of charities. Many people have spent hour after hour, day after day and week after week raising money for an extremely worthwhile cause. I want to say two things to my hon. Friend. The first is that clearly there are lessons to be drawn in relation to our ability to regulate branches of banks that are supervised in countries where the regime perhaps leaves something to be desired. The second is that we are very conscious of the position of charities. My right hon. Friend the Minister for the Cabinet Office has been looking at the matter, and charities—including, I think, representatives from the Christie hospital—met the Economic Secretary earlier this week. Indeed, they are also due to meet the Prime Minister shortly. We will continue to see what we can do. I understand my hon. Friend's point about charities and the differentiation that can be made for at least some of them and the larger local authorities, which might reasonably be assumed to have greater knowledge of how the system operates.

Vincent Cable: Given the excitement over the Governor's comments, yesterday was a very good day to bury bad news. Can the Chancellor explain the comments reported from a Treasury spokesman yesterday? The spokesman said:
	"The asset protection scheme and the code of practice on taxation for the banking sector are separate issues."
	That completely undermined the original terms of that arrangement, which required the full disclosure of all tax opinions. It suggested that the private banks had now won their battle to obtain support from the taxpayer under the asset protection scheme while continuing arrangements of large-scale tax avoidance at the expense of the British Government and maintaining intact their tax avoidance departments.

Alistair Darling: I do not know the quote that the hon. Gentleman is referring to. There are two distinct issues here, are there not? First, there is the asset protection scheme, which is designed to get credit flowing again and to ensure bank assets. As I said earlier, it is similar to the sort of thing that America and other countries are doing. There is a separate issue about the payment of tax by all companies, but the banks in particular. Both are equally important, because it is important that people pay what is due. On the hon. Gentleman's general points about yesterday, as I said to him before, I believe that what we are doing is absolutely right, not just for banking but more importantly for the wider economy.

David Chaytor: Now we know that the former directors of the Royal Bank of Scotland spent much of their last weekend in office plotting how to double the size of Sir Fred Goodwin's pension, is there not a more powerful case for some fiscal tightening over Fred's pension pot? Could the Chancellor give the House an update on the Government's efforts to scrutinise in fine detail the nature of that pension?

Alistair Darling: I said some time ago that UK Financial Investments Ltd., which holds our shareholding, and RBS are investigating that matter, with the lawyers looking at the position, and I have nothing further to add.
	It is important that we deal with the problems that we have inherited, but it is also important that, at all times, we look forward. We have to ensure that we put RBS and, indeed, the Lloyds Group and any other bank in which we have shareholdings, on a proper and firm footing—that we rebuild them with the eventual aim of returning them to full, proper commercial operation, because that remains our intention. It is important that we keep our eyes on that and recognise, in RBS's case, that its new management are taking a different approach and doing what is necessary to repair the damage that has been done—and they will have our full support in doing that.

Tony Baldry: Does the Chancellor recall that last November my right hon. Friend the Leader of the Opposition and my hon. Friend the shadow Chancellor warned that if the Government pursued reckless levels of borrowing, the question would stop being one of how much the Government want to borrow from the markets and become one of how much more are the markets prepared to lend to the Government? Is it not now clear that those warnings have been fully vindicated and that the Government have reached the limits of trying to borrow their way out of the recession?

Alistair Darling: I do not agree with the hon. Gentleman. As the Leader of the House said yesterday, the head of the Debt Management Office said a few weeks ago that one must always be careful about reading too much into one particular auction. The hon. Gentleman may not know this, but today's gilt auction, which concluded less than an hour ago, was fully covered. I would be cautious before saying what he said, which suggests that there is something to be said for thinking before one speaks.

Joan Humble: Will the Chancellor liaise with the Secretary of State for Work and Pensions to ensure that the hard-working staff at our Jobcentre Plus offices, who are delivering real support to people who are becoming unemployed, have the resources made available to enable them to continue to do the job that is needed and to work as hard as they are doing?

Angela Eagle: I support what my hon. Friend says and offer my congratulations on the superb work that Jobcentre Plus staff are doing. They not only have, unfortunately, a higher number of inquiries to deal with, but are getting their average time in dealing with them down and managing to ensure that more people return to the labour market faster. The rate of getting people back into jobs in the current recession is 60 per cent. after three months, whereas in the last recession, when Jobcentre Plus was not properly funded, it was 45 per cent. Jobcentre Plus staff are doing a magnificent job, and we are relying on them to get people back into work as quickly as possible. We will provide them with the resources to do that; the Conservatives voted against it.

Andrew Robathan: May I take the Chancellor back to his answer to my hon. Friend the Member for Hammersmith and Fulham (Mr. Hands), and draw his attention to a notice in the window of Lutterworth Motor Spares in my constituency that went up in December? It says:
	"Thanks Darling! The Chancellor has gifted the nation a reduction in...VAT...Hurrah!...Yippee!"
	That is the employment of something called irony, which entails a certain amount of ridicule. Could the Chancellor tell my constituent, Mr. Baxter, and all the other small traders who have seen no change or benefit to their sales, why the VAT reduction was not an extremely expensive waste of time?

Alistair Darling: I gathered that it was meant to be ironic—I think that I got there before the hon. Gentleman felt it necessary to make the point. It would be nice to be appreciated in his constituency, but that is clearly not the case in one part of the high street.
	My decision to cut the rate of VAT, which puts about £12.5 billion into the economy, will have an effect. It is not just there for one month, and it was not just there for Christmas. It is there for a 13-month period, and it has to be seen alongside a range of other measures: reducing tax for basic rate taxpayers, help for families and pensioners, and measures to bring forward construction. The difference between the hon. Gentleman and me is that I believe that Government have a duty to help the economy—and should do so—through times such as this, and he does not think so. The country will judge, but the lesson from the '80s and '90s is that if you do nothing, you will pay a heavy price.

Ann Cryer: Can I ask the Treasury what is being done to encourage the Financial Services Compensation Scheme to redress the imbalance in contributions from the banks, at 5 per cent., and from the building societies, at 15 per cent.?

Yvette Cooper: My hon. Friend has raised that issue with me, and I am due to meet her to take forward her concerns.

Michael Jack: The Chancellor of the Exchequer said in an earlier answer that he thought that the monetary policy being pursued would lower the cost of credit in the economy, but can I draw his attention to the fact that if, for example, someone wants to buy a motor vehicle, they will pay between 7 and 9 per cent. interest, while credit card rates are between 18 and 20 per cent. and mortgage rates, if one is lucky, are about 4 per cent.? When will the effect of the lower base rate reach the consumer in a way that will help to kick-start the economy?

Alistair Darling: The right hon. Gentleman should know, as he was a Treasury Minister during the last recession, that there is a difference between the Bank of England's base rate, what is charged for lending and what banks offer savers. Some banks are trying to offer a higher rate to savers, which in turn has to be paid for by a higher rate for borrowers. In general, low interest rates benefit people, such as those on tracker mortgages and so on, and many are seeing the benefit of lower rates. However, as I said earlier, the key is to ensure that we have sufficient credit, and credit at a price that helps the economy, which is what our measures are geared to do.

Eric Illsley: The Government are helping small companies in the area of taxation by making it easier for them to have a credit arrangement for tax payments. Could my right hon. Friend consider extending that assistance into the area of the status of certain companies, such as gross payment status? A company in my constituency is about to lose that status, which will put a considerable financial burden on them in the credit crunch.

Stephen Timms: My hon. Friend is right to draw attention to the effectiveness of the time-to-pay arrangements that Her Majesty's Revenue and Customs has put in place. With agreements reached very quickly, £1.7 billion of tax has been deferred so far, and a large number of businesses have been able to continue when they otherwise might not have done. I would be happy to talk to him about the issue in his constituency, and look at the idea that he suggested.

Mr. Speaker: I call Andrew Selous.

Andrew Selous: Thank you, Mr. Speaker. I thought that I might have been too short to be noticed. The Chancellor is responsible for ensuring value for money in public services, so what lessons does he intend to learn from the £1.4 million that has been "completely wasted", in the words of the principal of Dunstable college, on a new build project that was encouraged by the Learning and Skills Council over many years? That money could have been spent on students, and FE colleges up and down the country are in exactly the same position.

Yvette Cooper: The hon. Gentleman will be aware that there have been problems with the Learning and Skills Council and the decisions that it has taken at regional and national level. That is why the Secretary of State for Innovation, Universities and Skills has asked for a detailed inquiry and has been taking action, and why he is looking at areas that have been put in the position of having to consider their local colleges. The hon. Gentleman will know also that we have substantially increased investment in FE colleges from a baseline of zero—there was previously no money allocated for such additional capital expenditure. We are very clear that we need to keep investing in new facilities for FE, and I will certainly pass on his concerns about that college to my right hon. Friend the Secretary of State.

Simon Burns: Do the Chancellor and the Prime Minister have full confidence in the Governor?

Alistair Darling: I have made it clear on a number of occasions this morning that the difference is not between me or the Prime Minister and the Governor. The difference is between those of us who do and those of us who do not believe that we should be supporting our economy, jobs and increasing credit to businesses and individuals. The difference is that we are taking action; the Conservatives would do absolutely nothing.

Business of the House

Alan Duncan: May I invite the Leader of the House to give us the future business?

Harriet Harman: The business for next week will be as follows:
	Monday 30 March—A general debate on Africa.
	Tuesday 31 March—A general debate on the economy.
	Wednesday 1 April—Second Reading of the Geneva Conventions and United Nations Personnel (Protocols) Bill [ Lords], followed by a motion relating to the Non-domestic Rating (Collection and Enforcement) (Local Lists) (Amendment) (England) Regulations 2009.
	Thursday 2 April—Motion on the Easter recess Adjournment.
	The provisional business for the week commencing 20 April will include:
	Monday 20 April—A general debate on defence procurement.
	Tuesday 21 April—Consideration in Committee and remaining stages of the Industry and Exports (Financial Support) Bill, followed by:
	The Chairman of Ways and Means will name opposed private business for consideration.
	Wednesday 22 April— My right hon. Friend the Chancellor of the Exchequer will open his Budget statement.
	Thursday 23 April—Topical debate: subject to be announced, followed by continuation of the Budget debate.
	Friday 24 April—Private Members' Bills.

Alan Duncan: I thank the Leader of the House for giving us the forthcoming business. I thank her also for her thorough answer to my question last week about NHS trusts replying to Members' letters. It is encouraging that we can sometimes work together constructively on issues that affect all hon. Members and, more importantly, our constituents.
	May I, however, protest that convention has been discarded by the Government's somewhat offensive decision to stick a topical debate in ahead of the second day of the Budget debate, which is traditionally opened by the shadow Chancellor? Will the right hon. and learned Lady undertake to reverse that unacceptable decision?
	The draft National Assembly for Wales (Legislative Competence) (Housing) Order 2009, which would affect the right to buy in Wales, was laid before the House on 3 February and was down for scrutiny on Monday 23 March. That scrutiny did not take place. I would like to ask the Leader of the House why not and when the order will come to Committee. Even better, will she allow it to be taken on the Floor of the House?
	Yesterday, the Government promised that there would be an announcement on the inquiry into the Iraq war on 31 July, a full 10 days after the start of the summer recess. Quite simply, that is not acceptable. Will the right hon. and learned Lady undertake to give us a statement on the remit and intent of that inquiry before we rise for the summer?
	Once again, I stand here to request an urgent debate on Equitable Life. On Monday, the parliamentary ombudsman launched an excoriating attack on the Government's contemptuous treatment of her recommendations, and today in Treasury questions, the Economic Secretary compounded that by treating policyholders and this House with utter contempt. Because the Government's response has been, as the ombudsman put it, a betrayal of justice, and they have ignored her recommendations, she has decided for the first time ever to invoke powers to produce a follow-up report. When will we have such a debate, and when will the people affected be compensated?
	Citizens advice bureaux are performing an invaluable service for the millions of people who are suffering grave financial difficulties in the recession, and we should do everything we can to support them. Instead, the Government's new network of community legal advice centres is squeezing out CABs and forcing them to make damaging cuts at exactly the wrong time. May we have an urgent debate on the Government's decision to tender legal services in that way, so that the House can put a stop to the callous destruction of CABs?
	May we have a debate on the work ethic of Members of Parliament? Last week, we heard complaints from the Labour Chief Whip that at least 5 per cent. of his own MPs were completely idle. [Hon. Members: "Where are they?"] Well, exactly. Today, the Government have lost three votes in the Apprenticeships, Skills, Children and Learning Bill Committee, because Labour MPs, including a Minister, did not even bother to turn up. In the interests of value for money, which the public expect, may I invite the Leader of the House—I hear calls for this from behind me—to list the 5 per cent. by name?
	When it comes to performance, perhaps the right hon. and learned Lady will agree to be more forthcoming than she was at Prime Minister's questions yesterday. She refused to answer three questions from my right hon. Friend the Member for Richmond, Yorks (Mr. Hague) on what the Government thought about the Governor of the Bank of England's warning about a second fiscal stimulus. It has now become apparent that the Government's entire economic argument has collapsed, to the extent that  The Independent has today called the Prime Minister, "A haunted Prime Minister, marooned on his fantasy island". In a further fantasy, the Secretary of State for Children, Schools and Families has told the  New Statesman that he wants to be Chancellor and Labour leader.
	May we at least hope that the Prime Minister and Lord Mandelson can make the most of their visit to Brazil?  [Interruption.] It is not where the nuts come from that matters: it is the nuts we send there who worry me. It could, after all, be the right hon. and learned Lady's "Evita" moment.
	There is one little ray of sunshine. At last, one Minister has begun to take our advice and started making an apology. We are told that the right hon. and learned Lady got into a bit of a mess about whether the actor who plays Tony Blair, or Tony Blair himself, is the better looking. We have heard the words of her apology, "Tony, you are still the fairest of them all." One can but imagine his reply, "You know, I was a marvellous Prime Minister, but I got out in the nick of time."

Harriet Harman: The shadow Leader of the House has complained that we have scheduled a topical debate for Thursday 23 April, when otherwise there would be continuation of the Budget debate. I am happy to accept his protests. That business was only provisional, so I will amend the business and make sure that there is a full day's debate on the Budget opened by the Opposition, who choose the topic.
	The hon. Gentleman asked about the draft National Assembly for Wales (Legislative Competence) (Housing) Order 2009. We will make sure that it is properly scrutinised. The process is new, and we need to get it right.
	The hon. Gentleman also asked about the Iraq inquiry. There was a debate about that, and I have nothing further to add in business questions. Nor do I have anything further to add to what Treasury Ministers said about Equitable Life.
	I will raise with the Justice Secretary the hon. Gentleman's questions about citizens advice bureaux. The Government have strongly supported their work, which is even more important to help people who find themselves in difficulties because of the downturn.
	The hon. Gentleman said that our economic argument had collapsed. Well, that is not the way everyone sees it. The former Tory leader of Thurrock council, Councillor Terry Hipsey, expressed a rather different view when he said:
	"I've spent the last two-and-a-half years trying to keep this dysfunctional Tory group of Councillors together. Recently, after having some time to reflect, it has become clear to me that this group—and the Conservative Party more widely—are incapable of making the changes necessary to take Thurrock forward.
	I've been increasingly impressed with the group of Labour councillors".
	He went on to say that because of the excellent work of the local Labour Members of Parliament, my hon. Friends the Members for Basildon (Angela E. Smith) and for Thurrock (Andrew Mackinlay), and because of the work of the Prime Minister, he had decided to join the Labour party. We welcome him.
	The hon. Gentleman raised the subject of the work ethic. I think that his point about value for money was very important. It is the case that 60 per cent. of Conservative Members have second jobs. That is why I think that the public will greatly welcome the fact that the Prime Minister—

Hon. Members: Behind you! Where are they?

Mr. Speaker: Order. The point is that we are here, and we must listen to the Leader of the House.

Harriet Harman: Sixty per cent. of Conservative Members have second jobs, and I do not think that that is value for public money.
	The hon. Gentleman raised questions about what he described as manoeuvring. He mentioned a number of Cabinet Ministers, but I think that the manoeuvring on which he ought to be focusing is that of the shadow shadow Chancellor against the Leader of the Opposition. I think that it is a case of Hush Puppies on the Leader of the Opposition's lawn.
	The hon. Gentleman also mentioned my unfortunate gaffe in relation to Michael Sheen. Let me say that I think that he is an excellent actor, who is clearly capable of covering a diverse range of roles. He brilliantly played a socialist, Brian Clough. He also played the Prime Minister, Tony Blair. He is a great credit to his native country, Wales.

Kerry McCarthy: One of the many tasks that take up the time of Members of Parliament is handling constituents' worries about the way in which their benefits and tax credits are processed, and generally dealing with Government bureaucracy. May I urge the Leader of the House to call a debate on the Department for Work and Pensions report, published today, on how jobcentres and other organisations deal with customer complaints?

Harriet Harman: I think that the Public Accounts Committee report—I am grateful to my hon. Friend for drawing attention to it—reflects a big improvement in jobcentres and the way in which those claiming benefits are dealt with. Obviously the Government will reflect on the report, but it should also be pointed out that, against a background of increased work for jobcentre staff, they are providing a much better service. I pay tribute to them for that.

David Heath: I previously welcomed the two days allotted to the Report stage of the Coroners and Justice Bill, but last week's timetabling was a disgrace. None of the clauses relating to the reform of the coronial system were reached; nor, indeed, were the clauses relating to the law of homicide. The Government literally got away with murder.
	May I draw the attention of the Leader of the House to another problem? It relates to the Committee considering the Apprenticeships, Skills, Children and Learning Bill, which was mentioned by the hon. Member for Rutland and Melton (Alan Duncan). Setting aside the Government's difficulty that only six of their 12 MPs on the Committee bothered to turn up—I would love to have heard the conversation between the Deputy Chief Whip, the hapless hon. Member for Brent, South (Ms Butler) and the Under-Secretary of State for Innovation, Universities and Skills, the hon. Member for Birmingham, Erdington (Mr. Simon)126 clauses and 20 new clauses remain to be considered by a Committee that has only three sittings left. Some clauses may not be considered either in Committee or on Report.
	I have a revolutionary suggestion for the Leader of the House. We should do something that is normal in another place and that used to be normal in this place: we should not have a restrictive timetable, and we should let this House scrutinise the Bill properly and fully. If there are difficulties later, the Government can react to them, and if there is a need to shorten speeches, no doubt you can intervene, Mr. Speaker, but the House should have its say on that important Bill, which would be welcomed by all.
	Most Members are aware of the difficulties caused by endemic AIDS, tuberculosis and malaria in much of the developing world. The Global Fund to Fight AIDS, Tuberculosis and Malaria has been set up to deal with those issues. May we have a debate on the workings of the fund? The UK has a relatively good story to tellquite properly, we have taken the leadbut there is still a shortfall between the fair share of the British contribution and what is actually being received by the fund, which is desperately short of cash. May we in this House consider how we can better help people suffering from those awful diseases in other parts of the world?
	May we have a debate on the misuse of powers granted by this House to combat terrorism and serious crime? We heard a chilling report today about the number of local authorities that use surveillance powers for trivial purposes, and we hear repeated reports about the police using the Terrorism Act 2000 for inappropriate purposes, whether it is questioning 2,000 people at train stationstrain-spotters are apparently a threat to the statephotographers taking pictures of London street scenes, anglers who make the mistake of fishing at night, or the hon. Member for Hayes and Harlington (John McDonnell) attending the House of Commons. Those cases involve misuse of those powers. May we have a debate?
	Lastly, I do not know whether the right hon. and learned Lady has a Facebook account, and I do not know whether she has been poked recentlyFacebook users know what that meansor whether she has been asked to intervene. My Facebook friends are very upset at Home Office plans to snoop on sites such as Facebook, Bebo and MySpace. May we have a debate on that disproportionate and unnecessary extension of state powers, which leads us, despite it being 2009, inexorably to 1984?

Harriet Harman: On the Coroners and Justice Bill, if we had not had a programme motion, we might have ended up with two days' discussion of inquests in camera. Twenty-five Members contributed to the first debate, which is why time was squeezed for the important discussions on murder. Because so many Members wanted to contribute to the first debate, exceptionally we allowed two days. If we had not had a programme motion, we would have ended up with two days' debate on the first question. The programme motion ensured that on the second day we discussed incitement to homophobic hatred and a Government amendment tabled in response to complaints from the Opposition and others about our data-sharing measures. We tried to be as helpful as possible. Even though we provided two days for debate, it was not possible to discuss all the issues when so many Members wanted to contribute on the first matter of inquests in camera.
	We will make sure that the Apprenticeships, Skills, Children and Learning Bill is properly scrutinised.
	On local councils and surveillance, local communities ask local councils to use CCTV to catch fly-tippers and stop illegal trading. Local communities ask for CCTV in shopping centres and their local areas, which has nothing to do with the misuse of anti-terrorism powers. Having said that, the Minister for Local Government has written to local councils reminding them that they should use their surveillance powers appropriately.
	The hon. Gentleman asked about tackling disease in developing countries. He understands that we have increased the budget for developing countries to help to tackle disease. This Government played a leading role in the introduction of millennium development goals to deal with avoidable diseases, and we have worked to move up the international agenda tackling the problems faced by developing countries. Even in the midst of our preoccupation with the effect of the global downturn on this country, the Prime Minister has been sure to emphasise, through the work leading up to the G20, that we must act together internationally to protect developing countries from the downturn as well.

Martin Salter: My right hon. and learned Friend will recall her comments about the problems facing charities such as Naomi House children's hospice, which serves my constituency and those of many other hon. Members, following the collapse of the Icelandic banks. Will she prevail on her colleagues in the Treasury to find a way to include charities such as Naomi House in the Financial Services Compensation Scheme, as it was never the intention to exclude all charities from the scheme, particularly those that care for terminally ill children?

Harriet Harman: I reinforce the points that I have made about Naomi House providing an important service for families with children who need hospice care, and I know that my hon. Friend values that work. Naomi House was particularly unfortunate, because some 60 per cent. of its reserves were in one Icelandic bank. We want to ensure that the administrators ultimately cover all the deposits and that, ultimately, Naomi House gets its money back. However, that is not the point; the point is that Naomi House should be able to carry on doing its good work and extend it as planned. Last week, I spoke to the Minister of State, Department of Health, my hon. Friend the Member for Corby (Phil Hope), about the matter, and meetings are taking place between Naomi House and the local primary care trusts and strategic health authority. There is an absolute determination to support Naomi House's work in the future, as well as to make sure that it and other charities get back all the money held in Icelandic banks.

George Young: May we have an early debate and a vote on Equitable Life? At Treasury questions, the Executive declared war on Parliament, when a Minister spoke in disobliging terms about an Officer of the House and the unanimous report of a Select Committee. Before the Government spend too much time on the Chadwick review, does it not make sense to ensure that that review has the support of the House of Commons?

Harriet Harman: I have nothing to add to what the Treasury Minister said, except to say that the matter can be raised in the pre-recess Adjournment debate. If the Opposition want a Minister specifically to respond to the point, they can raise the matter in an Opposition day debate.

Julie Morgan: The importance of hospice care has already been mentioned this afternoon. I know that my right hon. and learned Friend is aware of how much hospice care depends on voluntary donations by the public and corporate bodies. On Saturday, I will open the spring fair for the George Thomas hospice in my constituency. In these difficult times caused by the global economic downturn, donations from the public and corporate donors decline. When can we have a debate on that important subject and on ensuring that hospices can continue their work?

Harriet Harman: I hope that the spring fair for the George Thomas hospice goes well, and I know that my hon. Friend is a strong supporter of it. Perhaps we should have a topical debate on the effect on charities of the fall-off in charitable giving, particularly by corporate bodies, and discuss what our strategic response should be. I believe that all Members think that the work of the charitable and voluntary sector is very important indeed, and a debate might provide us with an opportunity to decide whether we are doing enough to protect it.

Angela Browning: Now that the right hon. and learned Lady is taking an interest in the work ethic in this House, will she turn her attention to the work ethic of her fellow Ministers? In October, I wrote to the Economic Secretary to the Treasury on behalf of a constituent about bonuses paid by banks. As is my practice, I followed up with chaser letters, but to no avail, so we resorted to the telephone. On 3 March, my office phoned the private office of Lord Myners chasing a reply to my letter, only to be told that 900 letters were waiting to be signed by Lord Myners. When still no reply came, we phoned again on 24 October, and were told that approximately 950 letters were now waiting to be signed by Lord Myners. We have been invited to telephone his office yet again this afternoon. I wish the right hon. and learned Lady would do something about this.

Harriet Harman: I will follow that up. It is important that hon. Members are able to get letters from Ministers promptly.

Gwyn Prosser: Will my right hon. and learned Friend find time for a debate on the financial ineptitudes of shire county councils such as Kent, which invested 50 million of taxpayers' money in the failing Icelandic banks? Does she agree with the Audit Commission's findings published today, which label Kent county council's actions as neglect?

Harriet Harman: It is very worrying that the Audit Commission has said that Kent county council did not properly check where the reserves were being put on behalf of ratepayers. I am sure that the Minister for Local Government will follow up this important point.

Richard Younger-Ross: May we have a debate on the construction industry? The Government have said that the industry is important to provide economic stimulus; the Conservatives have said that no additional funds will be made available for that industry to provide that stimulus; the industry itself believes it can provide that economic stimulus. May we have a debate, so we can tell the industry what it can provide and when it can provide it, both as a short-term measure and a long-term strategy?

Harriet Harman: Such issues will be reflected in the economic debate next week, and in the debate following the Budget statement.

Ann Cryer: Is my right hon. and learned Friend aware that women working at the Driver and Vehicle Licensing Agency earn 5,000 per year less than men with very similar responsibilities who work at the Driving Standards Agency? Both agencies are part of the Department for Transport and both have Crown employees. May we have a debate on this matter?

Harriet Harman: I thank my hon. Friend for that question. There will be plenty of opportunity to debate this when we introduce the equality Bill. The reality is that women are not less committed to their jobs, or less qualified, less hard working, or less valuable in the workplace, but they are paid less. We need a strong equality Bill to make sure we strip away the secrecy that allows discrimination against women at work to flourish.

Greg Knight: Is the Leader of the House aware that there is growing anger in East Yorkshire and across Humberside, and, indeed, elsewhere, over the behaviour of some private wheel-clamping firms? Does she know that although they have to be licensed, many of them still use threatening behaviour to extract exorbitant fines from unsuspecting motorists? If we cannot have a debate next week, will she ask the Home Secretary to expedite her review, so that we can soon have in place new rules to stop this licensed thuggery?

Harriet Harman: This issue was raised with me in the House, and I discussed it with the Home Secretary. I think she fully agrees with the points the right hon. Gentleman makes on behalf of his constituents and those in his region, and when the review finally reaches its conclusion I am sure he will not be disappointed with its findings.

David Chaytor: I recall that at last week's business questions three hon. Members raised the financial problems within the Learning and Skills Council. Since last Thursday, the chief executive has resigned and the implications of the financial misjudgments are now extending to other colleges that had in the pipeline not major capital projects but minor capital projects for which they could reasonably expect to receive a smaller contribution from the LSC. Will my right hon. and learned Friend find time for a debate, because it would enable us not only to remind the country that in the last year of the previous Conservative Government there was no capital budget for further education and that in the last three years of the previous Conservative Government a 7 per cent. annual cut in FE revenue spend was required, but to see exactly how the current Government can resolve this problem?

Harriet Harman: It is right to point out that under the Conservative Government the capital budget for learning and skills in further education was not mismanaged because there was no such budget. I think there has been mismanagement and, as my hon. Friend says, the chief executive of the LSC has resigned. At the request of the Secretary of State for Innovation, Universities and Skills, Sir Andrew Foster is conducting a review. I think it is likely that there will be an oral statement when the review is concluded, and Members will have a chance to hear from the Minister and raise points.

Nicholas Winterton: Members on both sides of the House have raised with the Leader of the House their concern about the iniquity of the surface water charges being levied by water authorities and water companies. In my own area, United Utilities has declared a temporary moratorium for village halls, Scout organisations, churches and sporting clubs, but will she find time for a topical debate, because this House has never decided that such charges should be levied, and in my view they are unfair and iniquitous and place burdens on organisations that clearly do not have the money to pay?

Harriet Harman: This is an important issue, particularly for village halls, Scout groups and churches. It might be worth while for the hon. Gentleman to raise it with Department for Environment, Food and Rural Affairs Ministers at oral questions next week.

Malcolm Moss: May I return to the debacle over the LSC's total mismanagement of the Building Colleges for the Future programme? It was discussed in a Westminster Hall debate yesterday that was so over-subscribed that many Members were not called to speak. That was not surprising given that 144 new college build schemes have now been put on hold, including the College of West Anglia scheme in the town of March in my constituency, which was linked to 270 new homes under the regional spatial strategy for Cambridgeshire, a new country park, a 500,000 business centre and significant transport improvements, not to mention a massive uplift in education provision for an area with performance indicators well below the national average. May we have a debate as a matter of urgency to explore the reasons behind this massive Labour Government cut in education spending, and to find a way forward for those colleges, which are now in truly parlous situations?

Harriet Harman: The hon. Gentleman ought to reflect on the fact that this is mismanagement; it is not a cut, as we have increased the LSC's budget. We make no bones about the fact that there has been mismanagement by the LSC, but 261 college projects are going ahead, although in saying that I do not seek to minimise the problems for the 144 that are not. I know this is of concern to the House, because plans have been made and money has been spent in areas that were expecting the colleges to go ahead. I know the House will want to discuss this further. We will probably start with an oral statement, and then we will have to reflect on whether there needs to be a further opportunity for debate.

Lindsay Hoyle: I know that the Leader of the House has already been asked to arrange a debate on Equitable Life, but will she use her good offices to see whether we can speed up payouts to Equitable Life policyholders? I ask that because there is not a constituency in this country that has not been affected.

Harriet Harman: I know that this matter was addressed by Treasury Ministers this morning, and I am sure that they, like my hon. Friend and I, and, indeed, all hon. Members, want the ex gratia payment scheme to come into effect as soon as possible. It should be a matter of priority that those who are in most difficulty receive payments first.

Edward Garnier: May we have an urgent debate on the tax treatment by HMRC of sporting stars' testimonials? The committee representing one of my constituents has been trying to get an answer out of HMRC about the tax treatment of a sporting star's testimonial. It is clear that HMRC deals with cricketers and rugby players differently, and that there is a massive amount of delay, confusion and disarray in HMRC on this matter. All that the committee that looks after the affairs of my constituent is getting from HMRC is confusion, delay and obfuscation. If we cannot have an urgent debate, will the Leader of the House urge Treasury Ministers to see me and members of the committee?

Harriet Harman: I do not know whether the hon. and learned Gentleman tried to put a question to Treasury Ministers, but if he did not manage to catch the Speaker's eye earlier it would probably be a good idea for him to follow this up with a written question. In any case, I shall bring the fact that he has raised this matter to the attention of Treasury Ministers.

Stewart Hosie: When the Leader of the House left Prime Minister's questions yesterday, she missed three points of order made by my hon. Friend the Member for Moray (Angus Robertson), and the hon. Members for Meirionnydd Nant Conwy (Mr. Llwyd) and for East Londonderry (Mr. Campbell), which can be found at column 308 of  Hansard. Each of them contradicted the statement she made yesterday that this Government were not cutting spending, as that is indeed their plan for Belfast, Edinburgh and Cardiff. May we have an urgent debate in Government time on the impact of Government cuts to the nations and the Province, and will she lead it so that she can, at least and at last, bring herself up to speed with Government policy?

Harriet Harman: I am up to speed with Government policy, and I know, as the hon. Gentleman does, that the Barnett formula applies to Scotland. I can also tell him emphatically that of course we are not cutting spending in Scotland and Wales at the very time when public spending is more important, as the country faces this global economic crisisit is absolutely not the case that we are cutting spending now, in a recession. He is referring to the determination to ensure that across England, Scotland and Wales we get better value for public money spent. In Wales and England, a commitment has been made to secure 3 per cent. more efficiency in how public money is spent, but the Scottish Executive want to sign up to only 2 per cent.that is 1 per cent. less than in England and Wales. They should be prepared to show as much determination to ensure that public money is well spent as their counterparts in England and Wales, and they should not peddle the myths that we are cutting money to Scotland and that I do not know what I am talking about, as both of those are wrong.

Ian Liddell-Grainger: May we have a debate on regional development agencies? The south-west's RDA is putting more money into Swindon, Bristol, Exeter and Plymouth than it is into the rural areas. Somerset, which is a tourist destination, as the Leader of the House is well aware, is finding it harderor impossibleto get decent sums out of the RDA, as is Bridgwater, which is the only industrial town in the south-west. Please could we look carefully at what is happening, because if this continues in this recession, it will be harder and harder for investment to come into our areas because of the RDA's attitude?

Harriet Harman: The work of the RDAs is even more important as the country faces this economic downturn. Hon. Members surely wish to be able to hold RDAs to account for the balance of spending within a region, and the best way of doing that is by being on the relevant Regional Committee. Following the decision of the House, we are trying out Regional Committees only for the lifetime of this Parliament, so Conservative Members should at least try them. If, afterwards, they think that the Committees are a waste of time, they can say, I told you so, but they will not even try them. If they have these concerns, they should get on the Regional Committees and see whether they can help.

Nigel Evans: I think that when the Chief Whip said that he thought 5 per cent. of Labour MPs were not pulling their weight he was confused; what we have seen today is that about 5 per cent. of Labour MPs are pulling their weightand that does include the Leader of the House. I hope she can use her weight to get a debate on the lack of educational psychologists in this country, particularly in Lancashire. One of my constituents wrote to me about the cancellation of an appointment with an educational psychologist. When I wrote to the county council, it said it was having great difficulty recruiting any educational psychologists. There is clearly a lack of them throughout the country, so can we have a debate on the issue?

Harriet Harman: I shall raise that point with my ministerial colleagues in the Department for Children, Schools and Families. I take it that my colleagues are happy to leave me to get on with putting to the House the business of the House while they work hard in their constituencies.

Andrew MacKay: The Leader of House will have noted that Lord Myners responded in writing to the Treasury Committee admitting that he hadno doubt, mistakenlygiven false evidence to it the week before and did understand and know all the details of Sir Fred Goodwin's pension. In the light of that, should we not have a statement from the Chancellor, and should not Lord Myners be considering his position?

Harriet Harman: No, he should not. I did not watch all of Treasury questions, so I do not know whether this matter was raised. The focus of Ministers, particularly Lord Myners, in relation to Royal Bank of Scotland was on the fact that one of the biggest banks in the world was about to go off the edge of a cliff. His and our determination was to ensure that that did not happen, as it would have had catastrophic effects on all the staff in the organisation and on the whole banking systemin particular, on depositors. That was the main focus of his work, and it was the correct one. We are looking to see whether the pension arrangements really do hold water legally.

Maria Miller: I wish to add to the calls for a debate on further education, as the crisis in funding is hitting my constituency hard. The Government's response in yesterday's Westminster Hall debate was shambolic, and the Leader of the House needs to intervene urgently so that we can get either the oral statement that she has talked about or a debate, including a response from the Secretary of State, so that colleges in my constituency can get the reassurance they need for the future.

Harriet Harman: I will undertake to listen with genuine concern to the points raised by Conservative Members on further education colleges in their constituencies if they will reverse their plan to impose 600 million of cuts. I am concerned about FE colleges, be they in my constituency or in the hon. Lady's, but the fact is that her party's plans are to cut 600 million off

Mr. Deputy Speaker: Order. Mr. Speaker has already given advice to the Government Front-Bench team this morning about referring to Opposition policies, so to be consistent I should restrain the right hon. and learned Lady at that particular point. While I am on my feet, may I also say that I want to try to call all Members, but it would be very helpful if the questions were brief and the answers equally concise?

Evan Harris: Last week, the Leader of the House said that she took seriously the points I made about the need for this House to scrutinise legislation. May I suggest to her constructivelywe recognise that two days were given on the Coroners and Justice Bill and more time was given in Committeethat the solution must be that discussions be held about whether programme motions can be negotiated and agreed and we, in turn, can agree to restrictions on the length of speeches on Report, if necessary? That would mean that everything we need to have debated could be debated, and everybody would win. Will she engage constructively in those discussions?

Harriet Harman: The Government Whips do engage in discussions with their opposite numbers, and we will always try to get as much scrutiny as possible. We did see whether changes could be made that would meet with approval from all parts of the House, but some Members wanted to spend more time discussing the inquests in camera issue whereas others wanted to spend more time discussing murder and assisted suicide, and it was not possible to reach an accommodation with which everybody agreed.

Douglas Hogg: I welcome the fact that we are having an early debate on the economy, but I regret the fact that the Prime Minister will not speak for the Government. May I suggest that we rearrange the debate so that he can? Given the evidence of the chairman of the Financial Services Authority and the Governor of the Bank of England, it is plain that the Prime Minister has a huge personal responsibility for the economic plight of this country. Given that, to organise a debate without the presence of the Prime Minister is rather like organising a criminal case without the principal defendant being in the dock.

Harriet Harman: When making statements following international meetings, the Prime Minister deals extensively with economic issues, and he answers questions in the House every Wednesday.

John Bercow: Given that we have 80,000 prisoners in this country, that two thirds of them reoffend within two years of release, and that the whole system, including reoffending, costs 18,000 million a year, is it not time that we debated the Centre for Social Justice report Locked Up Potential, which calls for the scrapping of the three planned Titan prisons, for community prisons in their stead, and for an increased focus on education, training and rehabilitation?

Harriet Harman: That point was raised yesterday in Prime Minister's questions, and I shall raise it with the Justice Secretary.

Several hon. Members: rose

Mr. Deputy Speaker: Order. We have not reached the acme of brevity for which I was hoping.

Michael Penning: Last week, I asked the Leader of the House whether we could have a debate on the future of the Hemel Hempstead hospital. She said that I should have given her notice. I have raised the issue 25 times in business questions, and I would have thought that was enough notice. Since last week, the Highways Agency has put up new signs at junction 8 of the M1, displaying Hospital AE. It is closed: will the Secretary of State for Transport come and explain why he is leading people astray?

Harriet Harman: I think that it is the Secretary of State for Health that the hon. Gentleman is after. Did the hon. Gentleman ask a question about this at Health questions on Tuesday? It is a matter for Health questions rather than business questions.

Peter Bone: On Monday, the Prime Minister was slightly confused. When trying to dodge the Leader of the Opposition's question about why the Prime Minister was not reporting to Parliament on the G20 summit, he said that the date of the summit had been arranged months after the Easter recess. In fact, the Easter recess was decided on 11 March this year, but the G20 was announced on 26 November last year. Can we get the Prime Minister to come this Thursday to report on the G20 summit?

Harriet Harman: The Prime Minister takes his responsibilities to account to the House very seriously. I do not know the exact numbers, but I think that he has made more statements to the House than most other Prime MinistersI will look up the figures. No doubt the Prime Minister will want to account to the House in respect of the G20 summit.

Angela Watkinson: A number of local authorities have been found by the Audit Commission to be financially negligent in their investments with Icelandic banks, including the London borough of Havering, which is noted for its financial probity. May we have a debate on the exact nature of the warnings that were given, where the information came from and how it was communicated, because this will be a matter of great concern for local taxpayers?

Harriet Harman: It will be a particular concern to the seven authorities that were mentioned, and perhaps that is an issue on which hon. Members could apply for a debate on the Adjournment.

James Gray: Our suspicion that the disgraceful curtailment of debate on the Report stage of the Coroners and Justice Bill on Monday had more to do with chicanery over the issues of assisted suicide and murder than anything else was confirmed by the fact that the following day, at 11.20 am, we received a wodge of letters from the Under-Secretary of State for Justice, the hon. Member for Lewisham, East (Bridget Prentice), the Minister on the Bill, answering a variety of questions asked in Committeeon which I servedabout the coronial system. Ministers replied after any opportunity to debate the matter in the House. Does the Leader of the House agree that that is an appalling waste of ministerial time, and what can she do to ensure that it does not happen in future?

Harriet Harman: I have looked, in some detail, into how we could have ordered things differently[Hon. Members: More time!] Well, we had two days on Report, which was exceptional. I will look at the issue again to see whether any lessons can be learnt, but I ask hon. Members to recognise that there was no chicanery. We have no interest in anything other than proper scrutiny of the Bill. I cannot see how we could have tried harder to reach agreement, but I will look at that again.

Henry Bellingham: Further to the question asked by my hon. Friend the Member for North-East Cambridgeshire (Mr. Moss), is the Leader of the House aware that the College of West Anglia was planning not only a new campus in March, but a 100 million-plus new campus in King's Lynn on a brownfield site, on which depended new houses, business units and a new city academy? What does she say to those colleges that have spent large sums preparing such plans? May we have a debate and a confirmation that if those plans are cancelled, the colleges will get their money back?

Harriet Harman: We await Sir Andrew Foster's report. The Secretary of State will report to the House and there will then be announcements and an opportunity to discuss how we go forward beyond what is clearly bad mismanagement.

Mark Harper: The Leader of the House will know that many Members of Parliament have had many letters from constituents about Equitable Life. My right hon. Friend the Member for North-West Hampshire (Sir George Young) mentioned the comments by the Economic Secretary. In my right hon. Friend's polite way, he described them as disobliging remarks about an Officer of the House. Does the Leader of the House agree with the Economic Secretary? If she does, does she not think that that is in conflict with her position as Leader of the House and guardian of the rights of Members?

Harriet Harman: I did not hear what the Economic Secretary said, but I was present when the Chief Secretary made her statement. She acknowledged that there had been errors in management of Equitable Life that went back to the 1980s; that there had been regulatory failures for which apologies were owed and had been given; and that although there was no legal obligation to pay compensation the Government were determined, exceptionally, to make payments in recompense and a system for doing so was being established.

Philip Davies: May we have a debate on the NHS's recruitment priorities? I recently attended No.10 Downing street with an excellent organisation called midwivesonline.com to complain about the lack of midwives, and many of my constituents still find it very difficult to find an NHS dentist, but last year the NHS recruited an extra 9.4 per cent. of managers. Surely the resources of the NHS should be directed at front-line care, rather than bureaucrats filling in forms to meet Government targets?

Harriet Harman: The hon. Gentleman could have asked that question in Health questions earlier this week.

Julian Lewis: The Political Parties and Elections Bill is now before the upper House. The Leader of the House may be aware that two Liberal Democrat peers have tabled an amendment to strike out the new clause about confidentiality of candidates' home addresses, which was included in the Bill after a free vote for Conservative and Labour Members, but a whipped vote against for Liberal Democrats. What would the Government's attitude be in the strange event of the upper House deciding to overrule a free vote in the lower House about whether our home addresses have to be revealed when we stand for electionsomething that Members of the upper House, fortunately for them, do not have to do?

Harriet Harman: I voted for the hon. Gentleman's amendment on a free vote. I assume that if the issue comes back to this House, it will be subject to a free vote again, and I would vote for it again. Our constituents are entitled to know whether candidates live in the constituency, but they should not necessarily know the flat number or road, so the amendment was a sensible one.

Graham Stuart: I am grateful to the Leader of the House for saying that the Apprenticeships, Skills, Children and Learning Bill will receive proper scrutiny. I would be grateful if she explained how that will happen.
	To return to the issue of Equitable Life, there was an extraordinary statement by the Economic Secretary earlier. The Select Committee has described the Government position as morally unacceptable. Surely it is cause enough for a debate in this House when the ombudsman and the Select Committee are in direct opposition to the Executive. The Leader of the House has so far ducked the question. May we have a debate

Mr. Deputy Speaker: Order. As the hon. Gentleman was the last to be called, I indulged him with two questions, but he is now pushing it.

Harriet Harman: It is open to the Opposition to choose that subject for an Opposition day debate.

Council Tax

John Healey: With permission, Mr Speaker, I should like to make a statement on council tax in England and the capping action that the Government propose to take for 2009-10. Today, the Department has released figures showing that the average band D council tax increase in England next year will be 3 per cent., the lowest increase for 15 years. The average council tax rise for all households will be 2.6 per cent., the lowest ever since the council tax was introduced.
	There are three reasons for that. First, Government funding for local services is rising by 4.2 per cent. in 2009-10an extra 3 billion and the 12th successive annual increase above inflation for local government since 1997. Secondly, local authorities are taking seriously their responsibility to residents to tighten their belts and operate more efficiently. Thirdly, although I know local government does not like it, council tax capping helps concentrate the minds of councils. I have consistently said that we will take tough action when it is necessary to protect council tax payers against excessive increasesI said so to the House in November in my statement on the provisional local government finance settlement.
	I therefore want to set out for the House the action that we are now taking. Our capping principles relate both to an authority's council tax and to its budget requirement, which, broadly speaking, is the spending financed through the formula grant and council tax. I can confirm that our capping principles are that authorities' 2009-10 requirements are excessive if they set a budget requirement increase of more than 4 per cent. for 2009-10 or a band D council tax increase of more than 5 per cent. For an authority that was set a notional budget requirement following capping action in 2008-09, these principles operate by reference to that notional budget requirement and a related notional amount of council tax calculated for that year. The principles are described in more detail in a report that I am placing in the Library of the House.
	I realiseespecially as I look around the Chamberthat not all Members will be familiar with the concept of a notional budget requirement. Put simply, it is one of our capping options. It involves the Government's setting figures for an authority against which their future increases are comparedlast year, those figures were equal to the caps that would otherwise have been imposed in year in 2008-09. The requirement puts a greater onus on authorities to control their budget and council tax the following year, as they are measured against the lower baseline.
	Of the eight authorities against which we took capping action in 2008-09, four were set notional budget requirements. They were Bedfordshire, Norfolk and Surrey police authorities and Portsmouth city council. This year, two authorities have exceeded the principles I have announced. They are the police authorities of Derbyshire and Surrey. All other councils, police authorities and fire and rescue authorities have set increases within the limits I am confirming today.
	Derbyshire police authority has increased its budget requirement by 4.99 per cent. and its council tax precept by 8.68 per cent. Surrey police authority has increased its budget requirement by 4.82 per cent. and its council tax precept by 7.07 per cent. compared with the notional levels set last year. I am disappointed that Surrey has set an excessive increase for a second successive year. This is the first time under current legislation that we have had to take action against an authority more than once.
	Let me make it clear to the House that I am not announcing a cap on the council tax of Derbyshire and Surrey police authorities. I am starting a process that could lead to that. The authorities have a right under the legislation to challenge the proposed cap and to seek to justify their decisions. We will consider carefully all the representations the authorities may make before reaching any final decisions. Today I am writing to the chairs of the two police authorities confirming that I and my hon. Friend the Minister for Security, Counter-Terrorism, Crime and Policing will meet them personally to hear their case in person. After that, when we have considered any case made by the authorities, we can proceed either to designateor capthe authority for 2009-10, either at the level proposed today or at another level, or to nominate an authority, which means either capping the authority for next year, 2010-11, or setting a notional budget requirement for 2009-10 as the baseline for any future capping decisions.
	Confirming a cap for this year would require the authority to re-bill residents for a lower council tax, with the cost falling on the capped authority. All authorities set their budget requirements and council tax in the full knowledge that excessive increases could lead to re-billing, so they can have no complaints about this.
	The capping principles I have announced today are expressed in terms of band D council tax. That is because the band D amount that authorities are required to determine is set out by the legislation. However, the average household pays around 240 less than the band D amount and the increase for average council tax next year is 2.6 per cent, the lowest increase ever since the council tax was first introduced by the Conservatives in 1993.
	I would like to end by looking ahead. Central Government funding increases, the concerted efficiency effort of many authorities and our commitment to tough capping action have resulted in some of the lowest council tax increases ever seen. Nevertheless, council tax payers will not be pleased to see that 86 authorities have set band D increases of more than 4.5 per cent., especially during this period of economic pressure all round, while 39 of these authorities have set rises of between 4.9 per cent and 5 per cent. Some suggest that that is because such authorities believe the Government have in place some standing 5 per cent cap. That is not the case. The Government have always been clear that our purpose when setting capping principles is to protect council tax payers from excessive increases. In the current economic climate, keeping council tax under control is more important than ever.
	So I put all authorities on notice for next year. It would be a serious mistake for any local authority to assume that the principles I have announced today for this year are in any way a guide to the approach or the levels I may set in future years. I commend the statement to the House.

Bob Neill: I thank the Minister for providing advance notice of his statement. As hon. Members will know, he is unfailingly courteous and he unfailingly manages to put the most outrageous spin on events in the most reasonable fashion.
	May I ask the Minister to help me on a few matters? Is not the reality behind the Minister's words and this year's figures the fact that since 1997 council tax bills will have risen by 726 a year on band D, the band that is the basis of the statutory measure? Given that has happened across the board, in councils of all types and all political compositions, will the Minister accept that the Government must take responsibility for these hikes? Council tax bills are rising by 41 this April, compounding those previous rises. At a time when millions face losing their jobs or are suffering pay freezes, is that good sense? Is it sustainable that council tax bills are taking almost 120 from the pockets of families? Is it acceptable that council tax has gone up by an inflation-busting 105 per cent. on this Government's watch? Is not the reality that the Government inherited a local government finance system that worked and that has at least been consistent [ Interruption. ] I simply refer to a comment made by the Government in their 1998 local government Green Paper. It said:
	The council tax is working well as a local tax. It has been widely accepted and is generally very well understood.
	Of course, that was before the Labour party got its hands on it. The reality is that the Government have managed to break the economy and the local finance system as well.
	I hope that the Minister can help me on a couple of other specifics. Is not the 4.2 per cent. figure that he uses less than the whole picture? It relates to an increase in all grants, whereas the increase in formula grantthe only area where local councils have discretionis considerably less?
	The Minister is right to say that the efforts of local authorities should be appreciated, but might not that be because the Conservative party controls more councils than Labour and the Liberal Democrats put together? Would he care to reflect on that?
	Will the Minister confirm that one third of the basic state pension has been taken up in these council tax increases? Why has the proportion of pensioners claiming council tax benefit declined from three out of four to one in two on this Government's watch? Why has the Audit Commission raised concerns about the method of funding distribution? It has said that
	grant redistribution...has led to some councils putting up council tax more than others.
	Does that not raise the suspicion of fiddled funding? Is there not a need for a clearer and more transparent basis for setting the criteria for formula grant allocation?
	Can the Minister help me in relation to capping? Is he aware that the small print of the statistical release shows increases in parish precepts of 5.8 per cent., which come on top of the 8.1 per cent. rise last year and the 6.7 per cent. increase the year before?
	The Minister referred to the increase in the grant for police authorities, and two questions arise from that. First, is there not a need for greater and more direct electoral accountability of police authorities? Secondly, is there not a need for a control that is more effective than the crude capping device? Instead of imposing a cap, would it not be better to give local residents the opportunity to decide in a local referendum?
	Does the Minister regard it as acceptable that there is to be yet another council tax freeze in Scotland this year? It will mean that Scottish tax bills will be 265 less than in England, so might it not be time for the Government to adopt a policy of freezing council tax in England as well?
	Will the Minister confirm whether the Government intend to carry out a revaluation after the next general election? He will know that the suspicion is that they do: if so, that will be a further council tax stealth tax. Otherwise, can he explain why the Valuation Office Agency recently renewed its contract with Rightmove, which allows it to plunder estate agency records to find out how many bedrooms, bathrooms and parking spaces each home has? If there are no revaluation preparations, why has the contract been renewed and public money spent on it? It was said to have been drawn up explicitly for a revaluation. I remind the House that the VOA is the same agency that made such a mess of the ports revaluation that we debated in this House only yesterday.
	I hope that the Minister will bear it in mind when he answers those questions that the council tax is the most sneaky of the Government's stealth taxes. It is cooked up in Whitehall, but it is councillors on the front line who take the flak and the Government hide behind them.
	Despite the Minister's courtesy and the reasonableness of his spin, today's announcement means that families will have to pay an extra 40 a year in the middle of a recession. That demonstrates a serious lack of reality on the Government's part.

John Healey: I shall try to respond to the wide range of questions posed by the hon. Gentleman, but he can hardly say that the council tax is a stealth tax. Each year, the council tax settlement is debated and approved in this House, and the Minister in charge makes a statement, as I have done today. One of the difficulties is that the council tax is one of the most visible taxes, given the bills that residents receive.
	At the outset, the hon. Gentleman asked me to make the case for the level of local government funding. Next year, there will be a 4.2 per cent. increase in the total Government grant to local authorities, which means that, for the 12th year in succession, local councils will get an above-inflation annual increase from this Government. The direct comparison is that they suffered a 7 per cent. cut in real terms in the last four years of the previous Conservative Government.
	I did not want to make this debate political, but the hon. Gentleman asked me to say what the position really is. I can tell him that the council tax for the average home is 204 lower in Labour areas than in Tory areas, and 134 lower than in Liberal areas. The rise this year in Labour areas is lower than in both Tory and Liberal areas.
	The hon. Gentleman asked about the grant distribution and pensioner take-up of council tax benefit. Both matters were debated last month when this House examined and approved the local government finance settlement.
	Finally, it is true that we do not have the legislative powers to take action against excessive rises in parish council precepts. We expect parish councils to set their budgets prudently and to take residents' views into account and to respond to them. However, if it is necessary to take further steps or powers to deal with parish and town council precepts that become excessive for local council tax payers, we will do just that.

Sarah Teather: I thank the Minister for giving me advance notice of his statement. He lauds the 3 per cent. rise in council tax as a success, but does he recognise that it is still higher than inflationas it has been every year? Does he also recognise that council tax is felt more keenly than any other tax, because it is paid straight out of people's disposable income? As he acknowledged, many families are finding it very difficult to make ends meet at the moment. If both partners lose their job, they receive council tax benefit to meet the cost of the tax, but does he accept that the family will get landed with a large and unaffordable bill if just one partner becomes unemployed?
	Does the Minister also recognise that what is happening in many families is that, although people are not necessarily losing their jobs, their employers are cutting back on their hours because of the recession? In that situation, of course, there is no safety net. Does he thus accept that it is time that we completely reformed the system and introduced a fair tax based on people's ability to pay?
	Does the Minister also recognise that, in a recession, councils face both falling incomes and rising demand for their services? Their income streams from planning and leisure services, and even interest rates from investments, are all drying up, yet more and more vulnerable families, desperate for help, are arriving at their doors. In the light of that, will he commit to a moratorium on unfunded Government mandates to local authorities? Does he recognise that they will only make things worse?
	I was aghast to hear the final sentence in the Minister's statement. If he were really serious about wanting to keep council tax low for British families, he would set out the principles for cappingif capping is what he has to dowell in advance, so that councils can plan before they set their budgets. Instead, we go through the same macho charade every year: the Government threaten councils with draconian action but will not tell them what they need to do to avoid the penalty, and the inevitable result is that council tax payers pick up the bill for the cost of rebilling local residents. Worse, that approach destroys any constructive relationship between central Government and local government. It is high time that the Minister stopped behaving like a playground bully in that regard, and started behaving like a responsible partner.

John Healey: I have not been accused of being a playground bully before, but I am glad to welcome the hon. Lady to the Liberal Front Bench for the first time in our dealings on local government.
	I am not clear whether she is against council tax capping

Sarah Teather: I am.

John Healey: The hon. Lady confirms that she is against council tax capping but, combined with the increases in Government funding for local government funding, it is part of the reason why we have seen the lowest council tax rises ever in five out of the past six years.
	The hon. Lady is against council tax capping, but she also wants us to declare well in advance what the level of cap will be. The effect of that would be that many councils would set their council tax up to that level. That is not a good way of dealing with the issue or of protecting council tax payers.
	The hon. Lady is right about the pressures on local authorities. Like the Government, local government faces a demand for services as well as a reduction in some of its income streams. Most local councils have coped well over the last year, but it is clear that all local councils will have to do more this year to step up their drive to deliver their services more efficiently, as well as bringing in what may be necessary to support people through this difficult time.
	On council tax and housing benefit, the hon. Lady is right that part of the consequence of the economic downturn is a bigger demand on front-line service staff who are trying to deal with and support people through the claims process. That is why we have allocated local councils an extra 45 million for that purpose.
	Finally, for some time there has been a system in central Government such that if any Department places an extra responsibility or burden on local authorities to deliver services or to carry out functions they have not previously undertaken, it is the responsibility of that Department fully to fund them. It is my job as Minister for Local Governmentwhether or not I act as a playground bullyto ensure that other Departments fully fund any extra responsibilities they place on councils. That is precisely what we do at the moment.

David Chaytor: Last month, the Conservative council in Bury set a council tax rise of 4.99 per cent. At the same time, it introduced several million pounds-worth of cuts, including promises to privatise the youth service and switch off street lights in the middle of the night. Two weeks ago, we learned that the council had turned down the offer of 8 million of grant from the Government to support the Building Schools for the Future programme in the coming financial year.
	The good news is that as of yesterday the Conservative majority of one has disappeared after the arrest for blackmail of Councillor Peter Redstone, the former Conservative

Mr. Deputy Speaker: Order. There has been quite a long statement, so I hope we shall have a question. Has the hon. Gentleman formulated one in his mind?

David Chaytor: I have formulated the question, Mr. Deputy Speaker. As Bury council now has no overall control, and in the context of the arrest of the former finance spokesperson, will the Minister look carefully at this year's budget in Bury and the planning for next year's budget too?

John Healey: I have heard what my hon. Friend has said. It is clear that things in Bury have gone badly since Labour stopped running the council. From what he has told the House this afternoon, it is also clear that the council is looking for some soft targets to make easy cost cuts, which is in contrast to what many other councils are doing. They are giving priority to trying to protect and in some cases improve the services that people most need and, in particular, they are stepping up services and support for young people in our community. I am disappointed to hear that my hon. Friend's council is not following suit.

Patrick McLoughlin: With reference to the Minister's proposals as they concern Derbyshire police authority, may I point out to him that the authority described its budget for this year as a standstill budget? If he decides that the authority has to reduce its expenditure, does that not mean that front-line services will fail? Will he confirm that Derbyshire is the fourth worst-funded police authority in the country and that if it was funded as well as the authority in the constituency of the Minister for Security, Counter-Terrorism, Crime and Policing, who is sitting next to the right hon. Gentleman on the Treasury Bench, it would not have the problems that required it to raise that amount of money? Will the right hon. Gentleman confirm that Derbyshire is the fourth worst-funded police authority in the country?

John Healey: No, I will not, but I will tell the House that Derbyshire police authority is not just getting the 2.5 per cent. rise that all police authorities are guaranteed by the floor that my hon. Friend the Minister for Security, Counter-Terrorism, Crime and Policing is putting in place for funding. Instead, the authority is getting a 3.2 per cent. increase this year, which does not even take into account more than 14 million in specific grants and other funding that my hon. Friend has decided Derbyshire also needs to maintain its police services.
	Derbyshire will have the chance to lay out its case. If the authority wishes, it can do so in person to me and my hon. Friend. After that we will assess the extent to which we may need to proceed, with the options I set out to the House, having started a process that does not impose a cap today but could in the end lead to that for Derbyshire and Surrey police authorities. If the right hon. Gentleman and other Derbyshire Members wish to make representations to my hon. Friend and me, we will consider having a meeting to hear them.

Joan Walley: I welcome my right hon. Friend's statement, but may I press him a little more on formula grant? It is essential that local councils provide services, where needed, for disabled people and vulnerable people, yet in Stoke-on-Trent we are not getting the amount of supporting people funding that we should have. I am afraid that that will have an adverse effect on the amount of extra money that the council will need to raise, so I should be grateful if my right hon. Friend will assure me that he will look again at how we can get the amount of supporting people grant from Government that they say we need.

John Healey: I know how fiercely my hon. Friend feels about the issue and how much she is concerned about the services needed by many of the most vulnerable people in our community and in her city of Stoke. May I make three points? First, we have put in place a three-year funding deal for councils eligible for supporting people money. In part, that is to give those councils certainty about the income they will receive over that period so that they can manage their budgets better. Secondly, we have determined the amount of money for supporting people in Stoke in precisely the same way as for other areas. Thirdly, I am conscious of the case my hon. Friend makes and if she and either of her colleagues who represent the other two Stoke constituencies wish formally to see me or my fellow Ministers about the issue, we will happily set up a meeting and look at such representations as she may want to make.

Christopher Chope: The Government promised to bring in proposals for reform of the local government superannuation pension scheme by 1 March. What has happened to those proposals, and does the Minister accept that what he has been saying is far too complacent? Collectively, local authorities have record levels of debt and unsustainable pension schemes. There is tremendous resentment among ordinary council tax payers that they have to contribute four or five times as much to the pensions of chief executives on more than 100,000 a year than the chief executives themselves contribute.

John Healey: I shall write to the hon. Gentleman, who has been reading too many lurid and badly based articles about local government pension schemes. First, there is a legislative and regulatory constraint on local government pension fund deficits being passed on to council tax payers. Secondly, from the beginning of the current financial year, starting last year, the reforms I have put in place in the local government pension scheme mean that employees are paying more and employers'in other words, taxpayers'contributions are capped. Beyond that, it is not right to use private sector pension scheme formulae as a comparison with the position of local government pension schemes. They are regulated differently and use different financial accounting methods. It is like trying to compare apples and pears.

Fiona Mactaggart: Among the 86 authorities whose council tax increase has been between 4.5 and 5 per cent. this year is Slough, despite its having an excellent Labour council. The reason is that Slough has more people than was estimated by the Office for National Statistics. I am deeply concerned that we shall continue to be bumping at the top level of council tax increases, because on the basis of the three-year settlement, Government grant will not be able to meet the needs of Slough's growing population. Can my right hon. Friend offer any comfort to my local council tax payers and my local council that they will have the services they need, properly funded, in future years?

John Healey: The short answer to my hon. Friend is yes. Partly prompted by the case that she has made so assiduously in recent years, we now have a very detailed programme to improve population and migration statistics. We will make sure that those improvements take place, so that for the next spending review period, any decisions on local government funding, or other public sector funding that draws on those statistics, can be based on the improved population and migration statistics. She is right about the quality of her Labour council, which has a new leader, Rob Anderson. I visited the area several weeks ago to see for myself the innovation, the new services, and the serious way in which the council is going about not just managing the financial pressures that it is under, but making sure that it can improve services for people right across Slough.

Robert Walter: The Minister will be aware from discussions that he has had with leaders of one of my local authorities and with me that what is excessive in percentage terms is not always excessive in cash terms. North Dorset district council continues to be one of the lowest taxing authorities for band D in the country, with a band D council tax of just over 100. I wonder whether the Minister could help a small local authority in my area with a very low band D council tax next year, by having a discussion, or asking his officials to have a discussion, with the council's officials, so that we do not end up playing roulette with council tax bills, and so that the council is aware of the parameters within which it should be working?

John Healey: I think that I can help in two ways. First, I can help by setting out, as I have done already, the funding that the hon. Gentleman's council, and other councils, can expect from central Government for the full three years of this settlement period. That will mean that they know where they stand, and can plan and manage for that period. Secondly, I point out that the regional improvement efficiency partnerships are in place. They are led by local government experts and specialists in the field. They have the sort of expertise from which his council may well benefit, as it prepares to manage its services this year and plan ahead for next year. I will ensure that the regional partnership gets in touch with his chief executive and offers what help it can, as the council looks ahead to next year. If the hon. Gentleman wishes to make representations to me about the funding for his council in the third year of the three-year settlement, I will of course see him at the appropriate time.

Brian Jenkins: May I say to my right hon. Friend the Minister how much I welcome the extra 3 billion for local authorities this year, but could he provide us with a little more information? Will he list for this House the total reserves held by every local authority, work out what percentage those reserves are of their annual net budget, and present that information in a league table?

John Healey: We do not, at present, collect that information council by council, but we publish annually the reserves that local councils have in total. The last figures that we published put the figure at almost 14 billion. That is clearly part of the financial calculation and budget planning undertaken by all local councils. Particularly during this period of economic pressure, it makes sense for councils to look hard at the level of their reserves. Having sufficient reserves is necessary if there is to be prudential management, but the high level of reserves held by some councils might, in this period of pressure, be put to good use to maintain services and to keep council tax pressures down.

James Paice: Many councillors and tax payers in Cambridgeshire and many other areas will listen with astonishment to the Minister bragging about an increase of 4.2 per cent. in central Government funding when they see that the figure for their council is closer to just 1 per cent. Is it any surprise that they will naturally conclude that many other authorities must be getting considerably more than 4.2 per cent.? They will not be surprised to hear the Minister say that Labour councils are levying a lower average tax rise, because it is quite clear that the Government look after their own. Counties such as Cambridgeshire, where Labour has no representation, get no money.

John Healey: The hon. Gentleman has been around long enough to understand that we have a formula, which we consult on and debate in this House, for distributing funding to local councils. It applies equally across the country. He will also be aware that this Government introduced a system of floors. Without it, some of the councils that he may have in mind would, by rights, get less than they do. That floor is funded by taking the money off the rises for other authorities. He asks whether the residents of Cambridgeshire are aware of that; I ask him whether they are aware that his party plans, if it gets into power, to slash grants to local councils by 240 million from next month. That would, at a stroke, put an extra 1 per cent. on their council tax.

Alan Whitehead: I note that in his inquiries about a possible capping of authorities, my right hon. Friend is including both the budget and the council tax levied by those authorities. Does he accept, however, that over a period of time, the axis of what people pay in council tax is increasingly becoming divorced from the measure of the band D council tax payment? Is he therefore looking at measures to provide, in future years, a more accurate depiction of what may be excessive council tax increases? As far as capping is concerned, does he accept that if the Opposition had their waythey want to freeze council tax for a period, and would apparently never change the basis on which council tax is valued or chargedcouncil tax would be centralised to such an extent that local authorities would not even have the choice of whether to levy a low council tax or a high council tax?

John Healey: My hon. Friend is right, in that what we have heard from the Conservative party is a con. It is a con in two ways. First, it is a con to suggest that it will be a freeze for all councils, as has been promised, because the freeze will apply only to those that join the scheme. Secondly, it is a con to suggest that somehow that will give more power and decisions to the local area, because the constraints will still be set at the centre. He asked me whether I am considering seriously some of the principles of council tax. I know that he follows the subject, and is a source of fresh policy thinking almost without compare in this House. I am seriously considering a set of suggestions, and am looking very carefully at the ideas that he has submitted. I have a good deal of interest in them, and look forward to discussing them with him.

Henry Bellingham: Earlier this afternoon, the Minister said that any extra costs imposed on local councils by Government Departments would be reimbursed. Does that mean that local authorities in Norfolk will be reimbursed for the cost of responding to his Department's discredited, deeply unpopular and incompetently handled LGR?

John Healey: For the benefit of the House, LGR is local government reorganisation. Members should not make the mistake of accepting the hon. Gentleman's description of the way in which it is being handled. The short answer to his question is no, because from the outset of the process, we made it clear that if local authorities were going to play a part, they should cover the costs. We also made it clear that those costs should not be excessive. Clearly, councils that choose to use the legal process to try to influence the policy process should account for those costs to local residents. Finally, the important LGR process started with proposals that we received from councils, including councils within his area

Henry Bellingham: No.

John Healey: Including councils within his area, the county of Norfolk. We will bring the process to a conclusion as soon as we can, because there are important questions at stake concerning the future of local governance and local services for people in his county.

Russell Brown: My right hon. Friend has had to make a tough and difficult statement today, and I recognise, as I am sure that he does, that local government is a difficult beast to wrestle with. The Conservative spokesman mentioned a council tax freeze in Scotland; that has not come about without significant pain, and cuts in services, right across the country. The Liberal Democrats and the Scottish National party advocate a local income tax. I am sure that my right hon. Friend does not need me to tell him that those proposals lie in a bin in Holyrood.

John Healey: I have to concede to the House that I do not know a great deal about council tax in Scotland; I have my hands full looking after council tax in England. However, I note the points that my hon. Friend makes, including the fact that what was advocated by the Administration there has been put on ice, and is not, despite being a manifesto undertaking, likely to be put into practice.

James Gray: Will the Minister kindly look into what can be done to help several hundred of my constituents in the estates of Cepen Park North and Cepen Park South in north Chippenham, just on the outskirts of Calne? Through no fault of their own, they have been moved into Chippenham and Calne town councils respectively, which means that their council tax has increased not by 3 or 4 per cent. but by 17 and 20 per cent. this year, causing outrageous pain to quite a large number of people. Perhaps they had to move into those town councils, but would it not be possible to phase in that increase over a number of years? No one in the local authorities or town councils is saying that that would be illegal, so the Government could allow it to happen.

John Healey: I will look into the electoral ward arrangements raised by the hon. Gentleman. The bigger picture in Wiltshire is of a new council that will be up and running from next week. It will make massive savings for the people of Wiltshire, and we will see over the coming months the advantage of having one level of local councils, rather than two, because that will give stronger leadership to his county, as well as better services to his residents.

Peter Bone: Would the Minister like to conclude his statement by congratulating Councillor John Bailey and all the councillors at Wellingborough on the zero council tax increase this year? However, would he help with a serious matter relating to a local hotel that has been in existence for at least 16 years with no capital changes? Unfortunately, this year, it is paying 3,646 in council tax, but next year, it has been asked to pay 6,135I understand that that has something to do with the removal of transitional relief. In a time of recession, that is a major problem for the hotel.

John Healey: The hon. Gentleman is not talking about council taxhe is talking about business rates. He would have done better to have been in the Chamber yesterday, rather than today, when we debated that. I will write to him and explain how the business rate system works.

Peter Bone: And the congratulations?

Mr. Deputy Speaker: Order. The hon. Gentleman has pushed his luck far enough.

Defence in the UK

Bob Ainsworth: I beg to move,
	That this House has considered the matter of defence in the UK.
	Tragically, we begin another defence debate against the backdrop of further loss of life in our armed forces. Two weeks ago, the 152nd member of the forces died in Afghanistan, taking the total fatalities there and in Iraq to 331. Closer to home, two lives have been appallingly lost on our own streets, with the murder of Sappers Patrick Azimkar and Mark Quinsey in Northern Ireland on 7 March. I cannot imagine that they envisaged being gunned down in cold blood at their base as they bought a final pizza before deploying to Afghanistan. Our thoughts and deepest condolences are with the families of these brave people and with those rebuilding their lives after serious wounds. Those who sacrifice most are quite rightly at the centre of the agenda and of media coverage, but the armed forces do not view themselves as victims. They stand for far more than that: honour; duty; sacrifice; commitment. Oft mocked as unfashionable, but they are surely qualities to which the whole of society should aspire. It is a privilege from a personal point of view to work with these extraordinary people.
	I would like to focus this afternoon's debate on the essential relationship between the armed forces and society and the role that Government must play in that. Every day, the men and women of our armed forces are asked to do incredibly difficult things on our behalf in some of the most dangerous countries in the world. Tragically, some of them pay the ultimate price. It is therefore our duty to ensure that the balance between what they do for us and what we do for them in return is correct. We must look carefully at the interdependence that exists between the armed forces, the society from which they recruit and to which they ultimately return, and the Government who require so much of them.
	When we think about what the military do for us today, the overwhelming image is of soldiers, sailors and airmen bravely fighting the Taliban in Afghanistan. Those operations have a direct bearing on the safety of our streets back here in the UK. Our people are defeating terrorism there to stop it coming here. Similarly, they will soon complete a magnificent job in southern Iraq, leaving Basra transformed from how they found it six years ago. Quite rightly, we regularly debate operations overseas in this House, and I want to use today's theme of defence in the UK to spotlight the activities and the wider role that the armed forces play in the fabric of our society.
	Operationally, it is worth reminding ourselves that the Royal Navy has provided a continuous independent nuclear deterrent at sea since 1969. That is the ultimate guarantee of our national security, and it involves a submarine under the sea, 24 hours a day, 365 days a year. I drifted on to the conservativehome website the other day, as I do from time to time, and I looked at the debate there. That is part of the democratic process, and I accept that parties have to have these debates, but it would be enormously helpful to the people who provide that service to our nation if Opposition Members clarifiedthey can do so now, if they wish, or in their speechestheir support or otherwise for that continued provision.

Julian Lewis: I am terribly disappointed. For a moment, I thought that the Minister was going to say that he had read my long essay on the vital need for the nuclear deterrent, which appears on the conservativehome website. I am terribly disappointed that he appears to have overlooked it.

Bob Ainsworth: I have read the hon. Gentleman's contribution to that debate but, equally, I read what others say. There is a difficulty for Opposition Members, is there not? On the one hand, they are committed to a bigger Armyor are they? Clarification would be most welcome. On the other hand, I think they are committedor are they?to no increases in defence spending and, indeed, no promise to maintain the current level of defence spending. That is the Opposition positionnot that of the hon. Gentleman, who is always careful about these things, but it is certainly the position of his hon. Friend the shadow Chancellor. The gap has to be filled somehow. The question of where the cuts would be made is an intriguing one.

Bernard Jenkin: rose

Bob Ainsworth: Perhaps the hon. Gentleman will be able to enlighten me.

Bernard Jenkin: Would the Minister like to set out his own party's pledges for the next Parliament with regard to defence spending?

Bob Ainsworth: We do that, and we will continue to do that, and I am here in order to do that. However, I say to the hon. Gentleman that there is a duty on Her Majesty's Opposition. Opposition Members have made statements that are clearly out of line with one anotherthere are commitments to increase defence spending in one way, but no explanation of how that would be paid for in another area, as would be inevitableso I invite them now, or when they make their speeches, to enlighten the House as to where the cuts might fall to pay for the commitments that they desire to make.
	The Royal Air Force continues to ensure round-the-clock air defence. I saw some of the Typhoon aircraft and crews that do that when I visited RAF Coningsby late last year. Those quick-reaction aircraft are ready to launch and intercept any aircraft approaching the United Kingdom that might pose a threat, which is not a task or responsibility to be underestimated.
	The House will know of the niche capabilities, such as explosive ordnance disposal operators and search-and-rescue crews, who continue to carry out acts of supreme bravery and professionalism in support of the emergency services. More widely, I wonder where we would have been in the aftermath of the floods in 2007, or the foot and mouth outbreak in 2001, without military support. The armed forces helped save the day on each of those occasions. All this is possible because we have flexible forces, fit for purpose and with an indomitable spirit at their core.

Angus Robertson: The Minister will be aware that the safety deadline for upgrades to the Nimrod fleet is 31 March, five days away. Can he update the House on how many aircraft have had both sets of improvements made, on the hot air ducts and the fuel seals? On how many Nimrod aircraft will both of those improvements have been completed by the deadline?

Bob Ainsworth: I have written to hon. Members, making them aware of the action that we have taken to ensure that we speed up the work that is required on those aircraft. We are not prepared to fly beyond 31 March aircraft that do not have those vital fire breaks re-engineered and refitted, and we have taken the necessary action to do that. We are able to do that without the Nimrod stopping its vital mission in the UK. I think I have written to the hon. Gentleman making him aware of that, as well as to other hon. Members, so nobody can be in any doubt that we are holding to that 31 March deadline.
	What we have done is intended to enable us to get on with that work as quickly as possible, and we anticipate that the entire fleet will be refitted by the summer, and that we will be back up to full operational capability by the summer as a result of the actions that we are taking. We will not allow the firewall work to go beyond 31 March, the date we originally stated. We will hold to the deadline for that work.
	The armed forces provide more to society, though, than simply protecting it. They reinforce its strengths and values. Right at the heart of what our armed forces stand for are virtues such as respect, duty, discipline and a firm commitment to ensuring that talent is given the chance that it deserves. Many of us lament these qualities being less obvious in wider society, and it is this that I want to dwell onthe relationship between the armed forces and society, and Government's role and responsibility in that.
	The armed forces recruit from society and, in doing so, provide a springboard for men and women from all backgrounds, offering them opportunity, training, skills and, most importantly, a sense of belonging and self-respect. My military assistant characterises that as the ordinary man's way of escaping the ordinary. I view it as enabling so many people, often from disadvantaged backgrounds, to improve themselves and make their way in life.

Lembit �pik: I very much agree with the aspiration that the Minister describes for the Army and, on the whole, that is how it is. Does he agree, nevertheless, that those values were sorely lacking at Deepcut Army barracks, and that the death of four recruits there in the most unusual circumstances was the antithesis of what the Army should be about? Can he explain why, even now, 14 years after the death of Cheryl James, we still have not had the release of important information, such as the report by Devon and Cornwall police on the Surrey police investigation into her death? Does he agree that for the Army to achieve exactly what he says, we must have transparency, the absence of which suggests to me that she was murdered and that this is a cover-up?

Bob Ainsworth: The hon. Gentleman must believe in his conspiracy theories if that is what he wishes to do, but he knows, as he has been told by me, by my predecessor from the Dispatch Box and by others as well, that we are not the owners of that document. It is not a matter for the armed forces to release the results of police investigations. He must take the matter up with the relevant authorities. I have no ability to tell the police what to do, and no desire to do so. He can keep on raising the issue in defence debates and keep on suggesting that in some way the Army or the MOD is responsible for the report not being released, but that is not true. I think he knows that, in his heart of hearts.

Lembit �pik: I am grateful to the Minister and I do not seek to distract him from his core narrative. I understand what he said, and it has been said to me many times before. I simply observe that if the Minister or the Ministry of Defence indicated that they felt it was in the public interest and in the interests of the image of the Army for that report to be published, I am sure that would have a significant effect in motivating Devon and Cornwall police to do that.

Bob Ainsworth: The hon. Gentleman is free, as are others, to raise the issue with the police. It is not for us to tell the police how to do their job. It is their report, their investigation and their decision. He has been told so often, as he rightly acknowledges, from the Dispatch Box.
	The values that our armed forces represent start early through the cadets, which is probably the best youth organisation in the world and it continues to flourish. Whatever their background or their future careers, the young people who join the cadet forces leave better equipped to face the future. They also participate in more worthwhile activities than they would otherwise be able to do.

Brian Jenkins: On training, will my right hon. Friend give way?

Bob Ainsworth: I was speaking about cadets, not training, but I suppose I had better give way to my hon. Friend.

Brian Jenkins: I am listening with interest to find out about the extra capital to fund the extra large Army. Is it possible that the Army might have access to Train to Gain funding to train some of our soldiers, thereby releasing money to fund the extra Army units that some of us would like to see? Are we looking for extra money anywhere?

Bob Ainsworth: The Government pot is as big as it is, no matter where it comes from. The point that I was seeking to make earlier is that a party which, on the one hand, tries to tell the country that we are profligate and spending too much, repeatedly tries to pretend, on the other hand, that it can pull rabbits out of a hat for additional spending on defence and elsewhere to which it knows it is not committed. That is a pretty dangerous thing to do in a democracy, and it will get its come-uppance sooner or later.
	I was speaking about cadets. We should recognise and be grateful for the supreme dedication of the volunteer instructors who do so much for the Sea, Army and Air Cadets in our communities. Similarly, the reserves bring a range of unique skills to defence and play a vital role on operations. They also bring transferable skills and standards learned during their service back to their civilian lives and their civilian jobs. The House will be aware of our ongoing strategic review of the reserve forces. The review will ensure that we have reserve forces that meet defence needs now and into the future. It will also recognise their fundamental role in society. We will announce the findings of the review in an oral statement to the House shortly.

Malcolm Rifkind: The Minister will be aware that it was originally announced that the conclusion of the current review of the reserve forces would be announced about six months ago. Will he share with the House why it has taken so much longer to conclude the review? I hope he will be able to say that part of the reason is that the terms of reference do not preclude those carrying out the review from examining the gross misuse of the reserves over the past few years, as the current Government have sought to use them to make up for the very serious lack in regular forces during that period.

Bob Ainsworth: That is a travesty of the facts, if I may say so. Yes, we are behind on our original desire in respect of the review's time scale. But I have never been in any doubt that it was better for it to be done correctly than quickly, so I have never put the people involved in the review under any pressure to meet those deadlines and we have allowed the review not to meet the original times. Yes, the reserves have increasingly augmented our activities on operations, and when I meet and talk to them, I see that they do not mind that at all. What the reserves want is for their increased involvement to be reflected in their training and support, so our strategic thinking needs to some extent to catch up with what they have been delivering.
	It has not been an abuse, but the good, efficient use of reserve forces. They have volunteered and are damn good at their job. We need to make sure that, as far as we can within our resources, we train and support them appropriately so that they can play the role in which they have been so effective and for which they have been prepared to volunteer.

Bernard Jenkin: Will the Minister confirm that the review was conducted by Major-General Cottam, who left the Army months ago and now serves as the registrar at St. Paul's cathedral? That suggests that the review was completed, but that the Government are uncomfortable with its findings.

Bob Ainsworth: The hon. Gentleman will find out pretty soon, when we release the reserve forces review and enable him and others to participate in discussing it. I do not know whether he recognises this, but I have tried to make sure that the debate has been pretty inclusive. General Cottam has talked repeatedly to Members from both sides of the House; we have used the vehicle of the all-party group on reserve forces to make sure that that has happened. I have given the commitment that despite the fact that there will be an oral statement in the House on the day when we release the review, we will go back to the all-party group because of the contribution that it has made and the interest that it has shown. We will give it a more detailed opportunity to give its critique of the review when it comes out.

Julian Brazier: On behalf of the whole all-party group, I should say that we are grateful for the way in which we have been used as a sounding board on this issue. I echo the comment made by the Chairman of the Defence Committee at our last meeting: it has been a model example of adding value to a review by drawing on parliamentary opinion. I thank the Minister for that.

Bob Ainsworth: I agree. General Cottam himself was extremely grateful for the sounding board of the all-party group; he could properly capture where people were on some of the issues and make sure that he had that information tucked away as he did his work. He has expressed his gratitude personally, but I am happy to repeat it in the House.
	This country must leave no stone unturned to ensure that the remarkable people of our armed forces and their families, and veterans, are appropriately recognised and supported. That work can and must never be finished; it must be a work in progress to which we are all committed. To do otherwise would break the crucial relationship. The public's generous recognition of the armed forces in the past year, including fundraising and welcoming people home from operations, proves that fulfilling that relationship is squarely in society's consciousness. I applaud the efforts made by all of our citizens, and in particular by the people of Wootton Bassett, whom I visited earlier this month. I thanked them for the way in which they ensure that our fallen are properly received back in their country.

James Gray: I am grateful for the Minister's kind words about the people of Wootton Bassett, which is in my constituency. Some 2,000 of them turned out last Saturday for the tragic return of three bodies.
	The Minister will understand that the people of Wootton Bassett are deeply concerned about the future of RAF Lyneham, which is just down the road from them. We are awaiting an announcement on that, following consideration of Project Belvedere. Can the Minister give us some idea of when that announcement might be made?

Bob Ainsworth: I am grateful to the hon. Gentleman for his support for the armed forces and the encouragement that he gives us to continue to use RAF Lyneham. It is good to see that the community there is very supportive of our continuing to do so. However, he knows that we must try to get the best that we can from the estate and that we must use money efficiently. If we waste money on the estate, we cannot spend it on kit and equipment and the health and welfare of our service personnel.
	As I hope the hon. Gentleman knows, I am trying to bring the issue to a conclusion as soon as possible. I cannot promise that he will be on the good end of that news. We have not yet made any decisions, but we will inform the House as soon as we can about the outcome of Project Belvedere and the potential reconfiguration of our helicopter force basing priorities. The hon. Gentleman is worried about that and wants to try to take the opportunity to keep Lyneham alive. I cannot say whether he will be successful or otherwise.
	The central plank of Government efforts is the service personnel Command Paper, which was published last summer. That unprecedented piece of cross-Government and devolved Administration work is designed to optimise the support that we provide to our armed forces. It is based on two central principles: first, that no disadvantage should flow from service in our armed forces; and secondly, that in certain circumstances it is right and proper for our armed forces to be treated in a special way, particularly when people have been injured in the course of their duty.
	I will not rehearse the 40-plus pledges in the Command Paper, but let me give one example. By most assessments, British military training is the best in the world, offering a broad range of high-quality education. I am amazed by the amount of technological know-how that is required of our servicemen and women and how quickly they learn it. We must reinforce that aptitude as they retire from service. That is why the Command Paper now entitles all those who have served six years or more to free education up to degree level on retirement from the forces. That is a tremendous package to help our people to transfer successfully back into civilian life. The extraordinary opportunities offered during a services career now continue beyond it. Veterans, society and British businesses are all beneficiaries of the proposal.

John Smith: I am sure that the whole House supports the offer in the Command Paper to which the Minister referred. However, does the Minister agree that the new training regime to be introduced by the defence training rationalisation programme, which will ensure that all technical qualifications in the military will also be recognised civilian qualifications, will greatly enhance the recruitment and career prospects of our young men and women when they leave the forces?

Bob Ainsworth: I agree. It is vital that we invest in new training programmes and facilities. My hon. Friend never misses a chance to tell us that the greatest opportunity to do that is in St. Athan in his constituency. We need to take on defence training and to make sure that we stay at the cutting edge and get the new methodologies and equipment. The way to do that is through the defence training review, which will hugely benefit my hon. Friend's constituency. I hope it goes well and that we proceed to a final decision in the required time scale; I know that my hon. Friend supports that.

Robert Walter: There seems to be slippage on the defence training review and the move to St. Athan. When it was first announced in 2007, it was all going to be done in 2011, but in a written answer to me yesterday, the Minister said that the date was now 2015. I understand that the contracts are still in difficulty. Will the Minister give us some idea of when we will have some really firm dates?

Bob Ainsworth: The hon. Gentleman must accept that the proposal has its detractors, who seek for good reason to protect the status quo and jobs in their own areas and are worried about change; I do not criticise them for that. He should not listen to every bit of propaganda that is put out about the defence training review; he would find that, despite the economic situation, it is in nowhere near the difficulty that those detractors try to suggest. He should listen to a balanced view, not just one side of the argument.

Robert Key: Has the Minister read today's National Audit Office report on the Red Dragon project, which tells us that it has cost the taxpayer 113 million

James Arbuthnot: It is embargoed.

Robert Key: I had better take note of that; I apologise to the House.

Bob Ainsworth: I was about to acknowledge that I had not read itI am extremely grateful for the intervention by the Chairman of the Select Committee.
	Each year, 20,000 highly trained, motivated and disciplined former service personnel leave the armed forces. They are a fantastic national resource. By the time they leave the forces, individuals are better educated, fitter and more skilled than when they joined. In my view, though, the most important thing is that service life moulds people who leave with values such as integrity, leadership, responsibility and dedication. Those qualities are as welcome in society as they are with employers.
	The essential relationship between the armed forces, society and the Government will never be undermined by mindless extremists. This was brought into clear focus three weeks ago by a group in Luton who abused the Royal Anglian Regiment as it marched. We must not confuse that disgraceful abuse as being remotely representative of colour, religion, kith or kin. It is not: it is the action of thuggish yobs, and it certainly does not reflect the views of the wider Muslim community. I was enormously pleased to listen to a radio show in which Muslims in Luton condemned the actions of this minority, and I heard the same last weekend from Muslims in my own constituency. We should never forget that. The overwhelming majority of Muslims in our country are prepared to participate in debate and politics rather than abuse the servants of the state.
	Far worse than what happened in Luton are the killings of Sappers Quinsey and Azimkar. We must not let this deflect us from our path in Northern Ireland. It was a cold-blooded atrocity, wholly abhorrent, which was properly condemned across the political spectrum. I went to Northern Ireland last week to visit 38 and 19 Brigades and found a palpable sense of outrage wherever I went. Indeed, Martin McGuinness, not a man with whom I have agreed often over the years, summed up the views of the majority of the republican movement by denouncing the perpetrators of these shocking and callous acts as traitors.
	We must remember that Operation Banner is over. The Police Service of Northern Ireland takes the lead on security there, just as other police services do elsewhere in the United Kingdom. The armed forces provide support as required to the PSNIagain, as per the remainder of the UK. Our people are trying to live normally in Northern Ireland, no differently from elsewhere. This normalisation will not be derailed by a tiny minority. The House should be assured that we will afford the security of our people the utmost seriousness, and that we are doing everything that we can to protect our people from the mindless thugs who seek to attack them. We will provide them with a firm and secure home basenothing less is acceptable. Both in Luton and Northern Ireland, and across the UK, we must ensure that respect and tolerance are the bases of our society as opposed to extremism, whatever its guise. As so often, the armed forces are on the front line of this fight to protect our basic values, and we must be grateful to them for the job that they do.

Liam Fox: Before the Minister moves on to his peroration, will he tell us when the Government intend to make known their response to the recommendations of the Armed Forces Pay Review Body?

Bob Ainsworth: The hon. Gentleman should be patient. We are almost ready to make known our response to the review body, and we shall do so as soon as we are able to.  [ Interruption. ] He says from a sedentary position that it is overdue, but I am not aware that there is a set date for its release. We will make the House aware of our response soonthat is the only answer that I can give him. I urge him to be a little more patient.
	The relationship between the armed forces and society has to be a two-way street. Each complements the other; one cannot exist without the other. Government's responsibility is to ensure that that remains so, and that the armed forces are treated appropriately. This work in progress is something to which we remain wholly committedour people deserve no less.

ROYAL ASSENT

Mr. Deputy Speaker: I have to notify the House, in accordance with the Royal Assent Act 1967, that Her Majesty has signified her Royal Assent to the following Act:
	Corporation Tax Act 2009

Defence in the UK

Debate resumed.

Liam Fox: May I add my condolences and those of my colleagues to those expressed by the Minister? Our thoughts and prayers are with the families, not only of those killed in action but of those who have been injured, in their ongoing suffering. The House should remember the sacrifices that they, too, have made.
	It has been a privilege for me, like the Minister, to visit our armed forces in different parts of the UK, in Iraq and in Afghanistan, and to share the pride in and enthusiasm for what they do in our name. It is because of the esteem in which we hold our armed forces that so many of us were outraged by the events mentioned by the Minister involving those who chose to protest against the bravery and professionalism of our troops returning home from operations. I am sure that the whole House agrees that those returning from overseas deserve the full support of the British public, and nothing less. I think that decent-minded people were appalled and disgusted by the actions of unrepresentative extremists at the welcome home parade in Luton. It is, after all, thanks to the bravery and commitment of the men and women in our armed forces over many years that we have the freedom of speech that those nasty individuals were abusing, and they should be reminded of that fact.
	The best way for us, as a society, to show our contempt for those people and our support for our troops is not to ban protests, as some have suggested, but to outnumber the protesters and drown them out. What could be a better response to what we saw in Luton than to see huge supportive crowds cheering home our returning forces? Our deeds, not our words, will show what we really stand for. That fact was demonstrated a few days after the Luton parade, in Watford, where a parade by the Royal Anglian Regiment drew out thousands of people cheering as the troops marched through the town centre. The crowed was supportive, appreciative and, in some ways, defianta complete contrast to those ungrateful, unrepresentative extremists in Luton. Too often we allow minority voices to hijack the debate. The British public, the Government and Parliament must do all we can to encourage public support for the armed forces.
	As we debate the subject of defence in the United Kingdom, we would be negligent if we overlooked two major elements underpinning our nation's defence and, indeed, our role in the world: our nuclear deterrent and our ability to project power with aircraft carriers. I shall discuss the carriers first.
	An argument is made in some quarters that the carriers are useless because they will be of no help in the sort of conflict we face in Afghanistan. As things stand in the deserts of Helmand province, that is true, but it is beside the point. Nobody has ever tried to make an argument for the carriers on the basis that we needed them for current operations in Afghanistan, but I remind sceptics that there was a time, in the early days of the conflict in Afghanistan, when aircraft carriers were vital. For example, HMS Illustrious, with its 16 Harriers, which took part in the initial attack in October 2001, when there was no regional airbase that could quickly and easily be used.
	The argument against the carriers is also based on the false assumption that state-on-state conflict is a thing of the past. Unfortunately, history shows differently. Possessing the aircraft carriers in the 21st century will allow us to project power, influence and force in a way that would not otherwise be possible. In an era of globalisation, Britain's economic, trade and security interests are not only to be found here at home, in Gibraltar or in the Falklands, but around the globe, from the strait of Hormuz to the Malacca strait and most everywhere in between. In this complex world, British interests and the defence of the UK have no geographical boundaries, in the way that perhaps they did in the past. Because of that, we must have the ability to project power, influence and, if necessary, military force around the world.
	It is unfortunate that the Government have presided over delay after delay in the two carriers. They have now been in planning and design for twice the duration of the second world war. In December, right before the Christmas recess, we learned from a written statement that we can expect a further delay of up to two years. That was initially blamed on the joint strike fighter's entry into service, but we have since learned that that was not the main reason at all. I welcome the carriers as an important addition to the fleet and call on the Government to do everything they can to ensure their timely entry into service. However, we might ask why, when the Government are talking about bringing forward spending projects as part of the fiscal stimulus, major defence projects are being put back. But the current delay is only the tip of the iceberg in this Government's treatment of the Royal Navy. The journey that has led us to where our Navy is today has been one of serial betrayal by the Government.
	Time and again since the 1998 strategic defence review, our Navy has been blackmailed into accepting cuts to its fleet to ensure the eventual addition of the two new carriers that are so desperately needed. Back then, our Navy agreed to cut its fleet of 12 attack submarines to 10 and its fleet of 35 destroyers and frigates to 32, in return for the promise of the two carriers. A decade later, we find our Navy with only eight attack submarines, with a probable future reduction to six or seven, and an astonishingly low number22of destroyers and frigates. Maritime commitments have not decreased since 1998in fact, they have risen at a time when our Navy has been slashed, mothballed or, in some cases, sold off. Having an aircraft carrier capability allows us better to protect our global interests, but it cannot be used as an excuse for any further cuts to the capabilities of our Navy.

Bob Ainsworth: Surely the hon. Gentleman recognises that the biggest recent peacetime naval building programme is going on in the country.

Liam Fox: Yes, and as I will say later, that programme is over schedule and over budget, and it comes in a period when the Navy has suffered unprecedented cuts but is still being asked to carry out a wide range of functions. The Navy was told that it needed a certain number of frigates and destroyers to carry out the tasks set out in the strategic defence review, but year on year, the Government cut back on those. It is only the astonishing professionalism of the Royal Navy that has enabled us to carry out so many of the tasks so well during that difficult period.
	Many of the same arguments for supporting the carrier programme are applicable to the nuclear deterrent. The Minister began by asking about the commitment of my party to a nuclear deterrent. If hon. Members think back, they will remember that my party has always been committed to such a deterrent. It was those on the left who tried throughout the 1980s to go for unilateral nuclear disarmament and who did not support the nuclear deterrent. There are three reasons why we must have a nuclear deterrent. The first is the unpredictable nature of the post-cold war era. The harsh reality is that in many ways we had it easy with the bipolarity and general predictability of the cold war. As opposed to the concept of east versus west, or democracy versus communism, the global security environment in which we are now forced to operate more closely resembles the multipolarity of the 19th centurynot the 20th century, for which our instruments of national defence are structured. No one can accurately predict the threats that the UK will face between 2025 and 2055, when the next generation of the deterrent will be in service, just as no one 20 years ago could have predicted the speed of the collapse of the Soviet Union or the nature of the conflicts in which we are involved in Afghanistan and Iraq.
	Secondly, nuclear weapons simply cannot be uninvented; they will remain part of the international security picture in the future. The acquisition of nuclear weapons by North Korea and their attempted acquisition by Iran are real threats to our security. We do not have the right to gamble with the security of future generations. Thirdly, the United Kingdom has traditionally played a bigger role in acting on a number of global security-related issues than many of our medium-sized allies, especially in Europe. Consequently, we are more susceptible to future nuclear blackmail by rogue states in possession of nuclear arms.

Nick Harvey: I am listening closely to the hon. Gentleman. Do I understand the logic of his argument to be that there are no circumstances in which it would ever be possible for the UK to renounce its nuclear weapons?

Liam Fox: If, in the improbable event that we were able to technically uninvent nuclear weapons, they did not exist in any other part of the globe and there was no chance of them coming into existence in any other part of the globe, that might be a realistic suggestion, but while they do exist and while this country may be threatened with or subjected to nuclear blackmail, we must maintain a minimum nuclear deterrent. There are strong arguments for big reductions in the number of warheads held globally. There is a strong economic, moral, political and military argument for big reductions in the stockpiles of Russia and America, and I can see no strong argument against such reductions, but we in the United Kingdom have to be the arbiters of our own destiny. We have to be able to determine our own security, and while nuclear weapons exist, we in the UK are prudent and wise to retain and maintain a minimum effective nuclear deterrent.

Peter Kilfoyle: In the light of what the hon. Gentleman said, what does he make of the letter of 16 January in  The Times in the names of Field Marshal Lord Bramall, General Lord Ramsbottom and General Sir Hugh Beachpeople who would not normally be partial on these thingswhich was headlined, The UK does not need a nuclear deterrent? Would he say that they are old soldiers who are out of touch?

Liam Fox: They are perfectly entitled to their opinion. I happen to think that it is wrong. The nature of the threats that we face has changed quickly from the relative symmetry of the cold war to a range of other asymmetric and complex threats, and it could very well change again. Ultimately, the onus of explanation is not on those of us who wish to retain a deterrent, but on those who want to scrap it. They must tell us why they believe that they can predict the risks that we will face in half a century's time. The Government's White Paper, published in 2006, described the independent British nuclear deterrent as
	an essential part of our insurance against the uncertainties and risks of the future.
	I fully endorse that sentiment.
	It is an interesting element of the political debate that many of the opponents of the carrier programme and our nuclear deterrent are the same individuals who at other times claim that Britain is already too dependent on, and too close to, American foreign and defence policy. In fact, not having the aircraft carriers or a nuclear deterrent would make us even more dependent on the United States for our security. While British and American interests are likely to coincide in the future, and the Anglo-American relationship remains our most important strategic alliance, the UK must ultimately be able to guarantee its own security.
	It has been widely reported in the media and written answers that Russia has once again taken up its cold war habit of probing UK airspace. I understand, as we all do, that for operational security reasons the Government are unable to comment in detail on the Floor of the House on what actions have been taken to deal with Russia's actions, but I hope that in his winding-up speech this evening, the Under-Secretary of State for Defence, the hon. Member for North Durham (Mr. Jones), will be able to give us an idea of the number and frequency of incursions and offer the House assurances that procedures are fully in place to deal with them.
	In addition, will the Minister say whether his Department has seen an increase in Russian submarine incursions into British territorial waters? We hear often about Russian planes challenging the integrity of our airspace, but seldom, if ever, about what is going on below the surface. There is good reason to believe that such incursions are occurring, and as we are an island nation with only three naval bases, it is an important matter. I hope that he will address it.
	Those who think that state-on-state warfare is a thing of the past need only look at the recent invasion of Georgia by Russia and the build-up of Russian armed forces to have a sense of foreboding. One thing is certain: the global economic downturn has not deterred Russia from driving ahead with vast military reforms, requiring huge sums of money. On the contrary, it looks like it is spending at an ever-increasing rate. Russia may be building up from a low base, given the degraded state of its conventional forces, and it may not pose a direct threat to the security of this country, but the Russian leadership has shown in Georgia how it could destabilise our allies and threaten our security indirectly through a stranglehold on energy supplies. The cyber-attacks in Estonia, Georgia and Kyrgyzstan, for which the finger points at Russia, mean that we must maintain our vigilance and invest in the technology to deal with threats that could in future occur in this country.
	Our armed forces have seen a lot of combat in recent years, in the Gulf war, the Balkans, Sierra Leone, Iraq and Afghanistan. Improvements in body armour and vehicles have meant that many injuries that were once fatal are now survivable. We will see many disabled young veterans, and our society will have to adjust to that. However, that is only the visible damage: what is invisible must concern us as well. I would like the topic of mental health in the armed forces to be much higher up this country's political agenda.
	The Under-Secretary of State for Defence, the hon. Member for North Durham, told GMTV earlier this week that a study had shown that
	the actual number of people presenting with mental health problems is less than 2 per cent.,
	yet even if that is correct, it represents just under 4,000 people. That is a lot of individuals requiring a lot of care. The hon. Gentleman went on to claim that the study showed that those who had not been deployed on operations suffered more than those who had. There was something unclear about that, as it is true only of those suffering from mood disorders and depressive episodes. In fact, the report clearly states that the rate of post-traumatic stress disorder was higher among those deployed to Iraq or Afghanistan than among those not deployed there.

Kevan Jones: I said that.

Liam Fox: The Minister says that he said that, which I accept. However, PTSD often takes a long time to manifest itself. I fear that, with deployment after deployment, year after year, the mental health problems we face now, if unchecked, could become a mental health crisis, partly because our armed forces are operating at a tempo for which they are neither fully resourced nor fully manned.

Kevan Jones: I recognise the problem of PTSD, but does the hon. Gentleman not recognise that the number of people involved is small? It is higher among those deployed, as we would expect, but the important thing is to ensure that we do not confuse the broader issue of the mental health disorders that members of the armed forces face by concentrating overmuch on PTSD.

Liam Fox: Clearly they are separate, if related, issues, but the point about PTSD is that the number of people affected now are, almost by definition, the tip of the iceberg, because of the late presentation of the condition. We can expect to see more cases in future, and we as a society have a moral duty to prepare for that. We cannot look after only the physical injuries of those who fight in our name. We must place equal importance on those who suffer mental trauma.

Julian Brazier: My hon. Friend makes a very powerful point about this problem, which affects very damaged people, albeit a small number, who need help. Does he agree that perhaps the most disadvantaged group of all is those who have served in the reserves and cannot go back to a unit that is there full-time to look after them? Does he agree also that we could make far more use of reserve medical officers, who know what it is like to serve in uniform but are already embedded in the NHS, in solving the problem?

Liam Fox: I am extremely grateful to my hon. Friend. Indeed, our servicemen and women in the Territorial Army experience a further, unique set of problems. When a member of the TA returns home from operations, there is little or no formal support group or structure to fall back on, or camaraderie with fellow troops who have had similar experiences. There are no familiar faces on a base and no friends to meet for a pint to talk about what they have gone through. More often than not, TA service members simply return to their civilian jobs and go back to family life without the safety net apparatus that is provided by being a member of the regular forces. They are at particular risk. We have a duty to recognise that and put in place mechanisms to guarantee their safety.
	The important point that my hon. Friend raises is that the increased use of the TA means that there is likely to be an increasing rate of growth of those problems in future. We are developing a problem for our forces as a whole, but the TA in particular represents a potential mental health time bomb that, in many ways, we are not prepared to deal with.

Bernard Jenkin: Is my hon. Friend aware that Combat Stress, the mental welfare charity for ex-servicemen and women, has reported that whereas in 2005 only 5 per cent. of those presenting with PTSD were unfunded by Government help, that figure has now risen to 43 per cent. and is continuing to rise? That is putting great strain on the charity's resources. Given that the disorder arises directly from employment in Her Majesty's armed forces, is that not something that we really have to address?

Liam Fox: Indeed it is. Mental health services are the Cinderella service in the NHS, and as a society we must re-evaluate whether the way in which we treat those with mental health problems represents the social values that we would like to see in the world's fifth richest country in the 21st century. I met representatives of Combat Stress yesterday. Such charities do a wonderful job, but we will have to do a lot more if we are properly to fulfil our obligations to those who, as my hon. Friend says, suffer as a consequence of fighting for our security.
	They way in which we deal with the welfare of our armed forces is integral to dealing not only with the issues that we have mentioned but with our recruitment and retention problems. One thing that we need to consider is how we treat our armed forces compared with other public servants. I shall give one tiny example of mismatch that I was unaware of until my most recent visit to Iraq.
	As many Members will know, our troops returning from Afghanistan get a maximum of 48 hours' decompression, at the discretion of their commanding officer. It often occurs in unattractive surroundings in Cyprus, and we have all heard many tales of lengthy periods spent sleeping on airport floorsnot much respite for those who have faced bombings and shootings in our name. By contrast, the House might be interested to know that Foreign Office officials in Afghanistan get two weeks' compulsory decompression for every six to seven weeks in theatre. Even better, Department for International Development officials are entitled to the same two-week break away from post for every six weeks in theatre, but they can take a break anywhere in the world on condition that the cost is equal to or less than that of a flight back to the UK. That is not to say that we are treating our officials over-generously, but those in the armed forces will compare their treatment to that of people in other parts of the public service. That will have an impact on recruitment and retention.
	I end by giving the House a snapshot of what a decade of Labour's neglect has done to our armed forces. In procurement, the top 19 major procurement projects have gone over budget by a total of 2.95 billion. The Nimrod MRA4 project, which is delayed by 92 months, is 789 million over budget, and the order size has been reduced from 21 to 12. The Astute class submarine, which is delayed by 47 months, is 1.228 billion over budget. The Type 45 destroyer is delayed by 42 months and is 989 million over budget.
	Despite an almost unprecedented use of our armed forces in conflict since Labour came into office, Army numbers are down by nearly 2,500, the Royal Navy by nearly 7,000, the RAF by over 14,000 and the Territorial Army by 22,000. Our attack submarines are down by four, our frigates and destroyers by 12, our aircraft carriers by one, fixed-wing aircraft by 168, infantry battalions by four, and armoured fighting vehicles by 479. According to the Government's own figures, 31 out of 36 infantry battalions are under-strength, the shortage being equivalent to four battalions of soldiers. Twelve out of 14 TA infantry battalions are under-strength.
	The Government abolished the Defence Export Services Organisation, to the delight of those who oppose the arms trade. In 2004, when we were already involved in two wars, the Government cut the helicopter budget in 2004 by 1.4 billion, and we are still suffering from the consequences. Despite the two wars, this year's defence spending, at 2.2 per cent. of GDP, is the lowest since the 1930s. To cap it all, the Government have not conducted a strategic defence review for this country in 12 years. It is a desperately sorry record, which will take a very different Government a long time to put right.

John Smith: I thank you, Mr. Deputy Speaker, for allowing me to speak in this afternoon's debate. I pay tribute to the magnificence of our armed forces and their daily heroism, which we witness across the world. They are engaged on a number of fronts that nobody predicted or imagined. The House is aware of the tremendous job that they do in every part of the world where they represent the defence of this country.
	I shall concentrate on what might appear a narrow area of UK defence policy, but, as many will know, I have thought for some time that it is probably one of the most important areas, although it is often neglected and not fully discussed in the House: armed forces training. We can only have the best armed forces in the worldI happen to think that we haveif we provide them with the best possible training in the world.
	Since the end of the cold war, UK defence policy has gone through major changes, to which the hon. Member for Woodspring (Dr. Fox) referred. Through a series of defence reviews, we have reconfigured our force structures and armed forces to meet the new challenges resulting from the great unpredictability in the world. We need the ability to respond, which we have had in the past eight years, to unexpected challenges, to be flexible, to have much greater reach, and to be much more effective all round in different scenarios. The predictable scenarios of the cold war no longer exist, so we have, by and large, reconfigured our forces. Although there is some debate over that, it is generally agreed that it was necessary.
	We have reconfigured our kit to meet some of the new challenges. The aircraft carriers are on-stream to give us power projection worldwide. The one area that we have not reconfigured, however, is arguably the most important: the training of our enlisted men, ratings and NCOs. The training of the officer corps in the British forces in leadership and management has been successfully modernised and transformed, as the Select Committee on Defence saw on its visit to the defence academy at Shrivenham.
	The big challenge is modernising and transforming the rest of the services, particularly the skills and technical training of our armed forces. Eight years after the Government published a report stating that our training regime had to be modernised, we are nearing the end of delivering that for our armed forces. The defence training rationalisation programme is well advanced. The Minister made a statement recently in which he said that progress on that vital and radical project is on track and progressing well. Two weeks ago, a minute before the House extended the contingent liability to 40 million for the biggest Government PFI undertaken in any Department, to allow advanced design work and preparation for the scheme to continue.
	The project will completely transform and modernise our delivery of training. It will compress all our training in engineering, mechanical engineering, aeronautical engineering, electro-engineering, computer science and information technology, into one site in my constituency, at St. Athan. It will be the largest technical college by far in the United Kingdom, and one of the largest technical colleges and centres for technical excellence in the world. It will offer British armed forces, especially new, young recruits, the best technical training in the world. Nothing will compare with it anywhere else.
	All that training will be recognised in the civilian community, because qualifications will be civilian as well as military. I learned a skill in the armed forces in the 1960s, but it was no good to me when I finished, and I had to retrain. Many of our servicemen and women still have to do that today, despite the fact that 90 per cent. of them get civilian occupations within 28 days of leaving the forces, which is a tribute to their calibre and quality. However, the new training regime, at the defence technical college at St. Athan, will ensure that all our military personnel will leave with civilian qualifications. That is good for recruitment, because it will make a career in the armed forces much more attractive. It is also good for society, because the engineers who will be turned out over the next 30 yearsthe duration of the PFIwill serve the community at large. They will be provided with the most modern training environment in the world, using modern, computer-based equipment, virtual training techniques, and student-based and task-oriented training, not the traditional chalk and talk, which has served us well for many years but is out of date for the 21st century and the challenges that we face.
	The most important challenge is working in a much more integrated fashion, through jointery involving the three armed forces, and working much more closely with allies. We need a training regime that reflects the challenges that we face daily.

Robert Walter: The hon. Gentleman is doing a brilliant marketing job, but I am not sure that the instructors at the Defence College of Communications and Information Systems in Blandford would accept his description of the current CIS training regime as chalk and talk.
	Could the hon. Gentleman give us some ideaI alluded to this in my question to the Minister earlierof the likely time scale? It seems to be slipping farther and farther into the distance.

John Smith: I will refer specifically to the timetable, because I think that it is critical at present. As I have said, the project is on course, but Members should bear it in mind that it is one of the largest and most complex PFI projects ever tackled. The idea that no complexities, problems or challenges will arise throughout its duration is absurd. There are bound to be challenges, but I believe that there is a clear timetable.
	The planning application is due to be submitted in spring this year. It is detailed planning, for a massive 600-acre new-build development. This thing is gigantic. The construction programme alone is on a par with the one for the London Olympics. It is therefore understandable that there will be some delays. However, we can reasonably expect construction to begin in August 2010, phase 1 to be completed by the beginning of 2014, and phase 2 to be completed by 2015.
	We should pay tribute to the tremendous work of the defence training review integrated project team, which has been under the leadership of Brigadier Geoff Nield for the last four and a half yearsan extended periodto ensure ownership of the project. Brigadier Nield will be moving on shortly, but it is important that we record our thanks for his achievement in tackling the huge challenge posed by radically transforming our training provision.
	Let me return to the original point made by the hon. Member for North Dorset (Mr. Walter). I apologise for possibly accentuating my argument a bit too much. The term that I used was not intended to be derogatory towards the current providers, who supply excellent training on the nine legacy sites and the three existing military technical colleges. That training has been excellent, and has served us well over the last 60 years. The problem is that it is not the training that we need to meet the challenges of the 21st century.
	We need greater integration, greater jointery and greater flexibility in delivering our training. That will be possible only on a compressed site, with all our service personnel being trained side by side, and we could not wish for a better site than St Athan, which will be a purpose-built facility. I recall with horror and terror going to my first camp, as a young recruit, on a dark December evening. I thought that I had descended into hell. There was no heating. It was an old second world war barracks in Newark, for goodness' sake. It was a quite terrifying experience. These youngsters, however, will enter one of the most modern learning environments imaginable: brand new, and offering the best traininglargely from the private sectorand the best trainers in the world.
	Furthermore, during their stay at St Athan, the length of which will vary, men and women will have a choice. They will be able to go sailing along the beautiful heritage coast in the morning, go climbing in the Brecon Beacons in the afternoon, and at night go clubbing in Cardiff, one of the fastest-growing and most popular cities in Europe. What more could we offer them?

Ann Winterton: I have been listening carefully to the hon. Gentleman, and he must forgive me if I have forgotten, but I am not sure whether he has mentioned the overall cost of this magnificent project at St Athan, which is due to begin in 2010. What investment is required from the British taxpayer?

John Smith: Very little. This is a 12 billion PFI project spread over 25 to 30 years, but much of the risk will be carried by the private sector, and in particular by the two equity partners in Metrix, QinetiQ and Sodexo. This is a PFI project with much of the risk shifted to one side.
	As for the cost to the taxpayer, not only will we benefit from the most modern training in the world, but we will save money. The cost savings associated with reducing nine sites to one and getting rid of the current duplication in parts of our training provision over the next 25 years could be enormous. We win both ways. We win by securing the most modern training on offer in the most fantastic environment for learning, and we win by, over time, saving money in the defence training budget. That is what makes the project so attractive, and that is whycertainly in Walesit has received all-party support from day one.
	Progress is being made, and it is being made well. We want that progress to continue until construction starts next year. The facility will provide 1,200 courses. Up to 6,000 recruits at any one time, and up to 25,000 military personnel per year, will be trained on the purpose-built site. The MOD and the Metrix consortium have worked very closely with members of the local community, and have adapted some of their proposals after consulting them. We expect the detailed planning for this huge development to proceed relatively seamlessly in the spring because of the involvement of the community.
	Until recently RAF St Athan was the largest military base in the United Kingdom, so we are used to having large numbers of military personnel in the area, but we have challenges to meet if the project is to succeed and our military personnel are to maximise the benefits that they deserve. It is sometimes forgotten that the better trained and better equipped our armed forces are, the fewer casualties result when they engage in warfare. Superior training is much more valuable than large numbers.
	The Russian invasion of Georgia was mentioned earlier. One of the reasons the Russians are considering modernising their forces is that, by and large, that invasion was a disaster. There was little control over the military personnel. They succeeded because of their overwhelming numbers, not as a result of being highly trained and highly professional.
	We have a big challenge ahead of us, and we must get the infrastructure right for the project to succeed. The building programme will take three to five years, and we must ensure that the transport network is upgraded to match the large numbers of personnel.
	The project is based around the super-hangar, which was part of the Red Dragon project, and an auditor's report on the matter is imminent. Whatever the report says in criticism or otherwise of the Government or of the Welsh Assembly, we should not lose sight of the fact that the hangar was a critical factor in securing the 12 billion investment to transform military training. The hangar will become the core site in the training development.
	Our armed forces deserve the best, and through that project they will receive the best. I hope that hon. Members on both sides of this House will continue to support the project, as they have in the past. I hope that those who are responsible for making the decisions to improve the infrastructurethey are not necessarily in this Housewill ensure not only that our youngsters benefit, but that the local community does not suffer. I also hope that they take those decisions now.
	One or two critical decisions are coming up shortly. We will see a further extension of the contingent liability. Next month, the director of joint technical training for all three services will move to St. Athan. For those who doubt whether the project is on course, I point out that the director is taking a large team to oversee the transition from the existing colleges, as excellent as they are, to the brand-new, purpose-built site. The men and women who represent this country so courageously every day in some of the most difficult environments imaginablein recent years, the Defence Committee has had the privilege of visiting some of themdeserve nothing less than the best possible training in the world. They will get that at St. Athan, and I hope that the whole House rallies to ensure that the project is delivered on time and to budget.

Nick Harvey: Like the Minister and the shadow Secretary of State, I start by expressing condolences in respect of those who have died recently not only in Afghanistan, but, as we have heard, tragically and appallingly in Northern Ireland. The Minister pointed out that that takes the count of those who have died in Afghanistan to 152. Each of those casualties is an individual tragedy not only personally, but collectively for our armed forces. In addition to those 152 deaths, we must remember those who have been seriously injured or wounded, some of whom have been wounded in life-changing ways. We do not discuss those people as often as we should. There is something rather British about that, and it is certainly conspicuous that the Americans and, I think, the Canadians often pay greater tribute to their wounded personnel than we do.
	It is not easy to make this point, but I shall make it nevertheless. Although the figure of 152 deaths is shocking, if one considers the length of time that we have been in Afghanistan, the huge number of our personnel who have served there and the extraordinarily dangerous work, it is worth pausing and counting our blessings that that number is not a great deal higher. I take the view that that figure might have been higher, which would certainly have been the case in the past. Among other things, we should pay tribute to the advances in medical expertise that have prevented the situation from being a great deal worse.
	Both Front Benchers rightly referred to the disgraceful scenes when the Royal Anglian Regiment paraded in Luton, and I echo the sentiments expressed by other hon. Members. It occurs to me that those who mounted those ill-judged protests shot themselves in the foot in terms of the cause that they were trying to promote. The overall effect was to give far more public attention to the home-coming parade than might otherwise have been the case and to unite public opinion in appreciation of what those troops have done on our behalf and in abhorrence at the protestors and their message. The public are now showing a greater appreciation of our armed forces; that has increased a lot in a remarkably short period of time. The regular scenes in Wootton Bassett that we have heard about are a leading example of that. In previous debates in this House, many Members have made the point that our work in Afghanistan is sometimes misunderstood by the British public, but I draw some encouragement from the fact that there is now growing appreciation of what we are trying to achieve there.
	Only five months have passed since we last had a debate entitled Defence in the UK, but a great deal has happened in that time: there has been a grave worsening of the economic crisis; there has been the decision to issue a timetable for withdrawal from Iraq; and a new US Administration have arrived, with a very different approach from their predecessor. I particularly welcome the announcement of a timetable for withdrawal from Iraq, and I recall with some amusement that when we Liberal Democrats argued previously for that, we were lampooned on the basis that we could not have a timetable for withdrawal and it was naive of us to think that such a thing could be done as we should never signal our intentions to the enemy. However, we said at the time that the day would inevitably come when the Government would announce a timetable for withdrawal from Iraq, and they have now done so, and so too have the Americans. It is my sincere beliefas it was when my right hon. and learned Friend the Member for North-East Fife (Sir Menzies Campbell) first suggested to this House that there ought to be a timetable for withdrawal from Iraqthat that is long overdue and could have been done a great deal earlier.

Julian Lewis: I am pleased that a debate on defence in the UK can be interpreted as covering defence in the world, and I would just point out that the Liberal Democrats were proposing a timetable for withdrawal before the surge had happened and succeeded, and at a time when the outcome of the conflict in Iraq was very much in the balance.

Nick Harvey: I respect what the hon. Gentleman says and I understand his argument, but the point that was made at the time was that one could not have such a thing as a timetable for withdrawal, and the fact of the matter is [Interruption.] That was not the point that was made at the time; the point was made that we could not have a timetable for withdrawal, but of course we can have a timetable for withdrawal. Clearly, it has to be a timetable that takes account of the circumstances, but the fact of the matter is that we can have such a timetable and, ultimately, as was always going to be the case, that is precisely what we have ended up having.
	The arrival of a new US Administration is a very welcome development. That is already giving rise to a remarkably swift reconsideration in the United States of its approaches to some of the significant issues with which we are ourselves tied up.

Peter Kilfoyle: Will the hon. Gentleman also touch on the changes taking place in Europe, notably the decision by the Czechs no longer to participate in the futile missile defence programme, which the official Opposition, along with the Government, seem to be hellbent on pursuing, regardless of Obama coming into office?

Nick Harvey: That is certainly a very interesting development, as, of course, is the French decision to rejoin fully the NATO command. These are all factors that affect the circumstances in which we organise our defence in the UK.
	It seems to me that in the UK defence is still the poor relation in the progressive agenda. We have seen new thinking in education and health and on the environment, but in defence we remain stuck with some outmoded habits and a lack of new thinking. As has been said, it is perfectly true that there has been substantial and significant reorganisation of our armed forces since the end of the cold war, but it is still possible to level the criticism that we remain too much configured along cold war lines and that there is a need for further reorganisation to get us configured for the modern-day realities. America has, I believe, woken up to this; President Obama is planning an overhaul of US defence procurement and strategy, bringing it out of the cold war era. When, I wonder, will we? In every debate Ministers are urged to set up a new strategic defence review so that we can reassess and realign defence, where necessary, and make new decisions about how to face future threats and challenges, yet still they resist any suggestion that that should happen. I am confident that after the next election, whatever its outcome, a strategic defence review will be set up, but it could be doing its work a great deal sooner if some of the scoping of it were to be set in train now and were to be subject to some debate before the election.

Richard Younger-Ross: Is there not a danger that if we are still fighting the last war to happenor the last that did not happenand still have a cold war mentality, there will be some, particularly in Russia, who interpret that as being a threat to them and that will end up distorting their foreign and military policy? That may make our maintaining a cold war strategy, in part, a reality, rather than the reverse; the deployment of missile defence may be making the situation a lot worse.

Nick Harvey: My hon. Friend makes an interesting point. I do not think it takes very much for the Russians to interpret anything they choose as some sort of provocation, but one certainly does not want to give them any additional grounds for doing so, if one can help it.
	One can only hope that by the time we next have this debate, most of our involvement in Iraq will be over. I echo the points made in yesterday's debate about the fact that we should be getting on with the process of setting up an inquiry into exactly what we achieved there, what went well, what went wrong, why we got involved in the first place and what lessons we might draw from that for future engagements, particularly if we maintain, as the outcome of the strategic defence review, as I hope we will, a commitment to an interventionist policy and to expeditionary warfare. I hope that lessons will also be learned for operations in Afghanistan, where there are still many challenges ahead, most notably the real problem of overspill into Pakistan, which is, itself, very unstable at the moment. We will have an ongoing task preparing the British public for what will be a protracted conflict.
	The economic crisis poses a new threat to our national defence. We have been aware for some time that there is a black hole in the Ministry of Defence finances. A year or so ago, it was estimated at 2 billion, and it is in no danger of shrinkingindeed, there is every likelihood that it will get bigger and bigger. Estimates of true defence inflation vary; some say that it is at least 3 per cent., whereas other figures that are cited are higher. It is clear that the defence industry is not going to remain untouched by the current economic difficulties, and this will bring uncertain consequences for the skills bases, contracts and projects involved.
	In these uncertain times, the defence industry is partly immune from the wider malaise, but we must be careful to ensure that the economic difficulties do not impede further our activities overseas or the delivery of vital resources to the front line. The recent Defence Committee report highlighted that, even now, there are problems with equipment. Our track record on procurement is like a broken record: delayed, over budget and below requirement. The Government have yet to face up to the reality of how on earth they will be able to afford all the programmes that are still in place in principle on the budget that is available at the moment and what they will do to get industry on board, to try to make the delivery of existing projects more efficient.
	As part of the present crisis, we should look at current procurements, but problems from the past are also catching up with us. We have heard that Nimrod is to be grounded, which is an admission that the fleet is not fit to fly. It seems to have taken Ministers a long time to arrive at that conclusion, whereas aircrew, coroners and others have been saying for some time that the aircraft are not airworthy. It does not surprise me, in the light of the current economic storm, that Trident and the proposal to renew it have been mentioned. We heard from the hon. Member for Liverpool, Walton (Mr. Kilfoyle) that some distinguished retired military figures have been debating it. We heard from the Minister that people have been debating it on the conservativehome website. There is renewed interest in the subject in the light of the economic crisis.

Peter Kilfoyle: It is not only distinguished ex-military personnel, but they have been fairly outspoken. I would far sooner listen to people who have been on the front line than the armchair generals of the television studios or newspaper columns. Ted Postol, the man who designed the Trident system, has pointed out that it could be adapted for the needs of our country, if that is what we wish, instead of spending an as yet indeterminate sum replacing it.

Nick Harvey: The hon. Gentleman makes a very good point. It is right to ask questions about this issue. We believe that the House was premature in seeking to make a decision two years ago. A final decision does not have to be made, and in truth will not be made, until main gate, which is the point at which the Thatcher Government made the political decision about Trident. The significant costs of Trident replacement will begin to rack up only midway through the next decade. I do not suggest that the questions need to be answered today, any more than they had to be two years ago, but it is right that the questions are being asked. They will continue to be asked from now right through to the time at which any decision is made. It is especially apt that the questions arise at the moment, as we progress towards the 2010 non-proliferation treaty conference talks.
	I listened with interest to the hon. Member for Woodspring (Dr. Fox), who expressed his sincerely held view, which can be fairly characterised as being that there were no circumstances in which he thought it would ever be possible for the UK to give up its nuclear deterrent. That is a point of view, and he is entitled to hold it, but if he, as a Minister, were to articulate that position on behalf of the UK, it would undoubtedly put us in breach of the nuclear non-proliferation treaty. We have binding and solemn commitments under that treaty that it is our duty to try to fulfil at all times.
	Personnel must be our priority. Withdrawing from Iraq will alleviate some of the burden, but Afghanistan will continue to take its toll. The mental health casualties will start to become more apparent in the coming years, and we surely all agree that more needs to be done to tackle this issue head on. However, I welcome the progress that has been made recently. We still have a huge problem of alcohol and substance abuse among former personnel, and a high proportion of prisonersone in 11, or some 8,000are ex-services.
	Preparing our service personnel for life after the armed forces, whether that be rehabilitation, medical care and support or further skills and education, still needs to become more central to our thinking. For service personnel and their families we must do more to honour our commitments. In particular, a recent National Audit Office report revealed that housing was still in a sorry state. As I have said before in these debates, at the current rate of progress, it will take 20 years to bring all the housing up to scratch. That was widely pooh-poohed at the time, but I was intrigued to note that the NAO report arrived at the same figure.

Bob Russell: Does my hon. Friend agree that that is a legacy of the privatisation by the previous Government of the MOD housing stock to Annington Homes? It also represents the failure of this Government to address the problem, because 12 years down the line the public purse is still spending a small fortune for property that it does not, and will never, own unless legislation is introduced to bring MOD housing back under MOD ownership.

Nick Harvey: There is no doubt in my mind that the Annington deal was a bad deal for the taxpayer and that we have, in a sense, been paying a price for that ever since. I must say that the Government have a nasty habit of aggregating routine maintenance, rent and improvements and of presenting the sum of those costs as though the total was all being spent on improvements. That, I am afraid, is misleading. It will take a long time

Peter Kilfoyle: Will the hon. Gentleman give way?

Nick Harvey: I have given way to the hon. Gentleman a couple of times, and I think that it would be better if he made a speech himself, if he can catch your eye, Madam Deputy Speaker.
	The fact is that nearly a third of service personnel and their families are unhappy with the standard of accommodation.
	We have mentioned already that there are interesting developments in Europe. The US, for example, has made it clear that it wants to deal less with the UK as a bridge to the European Union and more with the European Union as a whole. Although we must continue to have a strong bilateral partnership with the United States, it is in its interest as well as ours to have a stronger European partner this side of the Atlantic. I hope that the Minister and his colleagues are exploring avenues for greater defence co-operation, particularly now that the French have changed their stance in such a significant way. I hope that in the fullness of time, such co-operation will come to enjoy the support of all parties.
	UK defence, in my view, is in drastic need of an overhaul. We need a new strategic defence review and a good hard look at the configuration of our defence and the infrastructure behind it. The economic crisis only adds to the imperative to deliver cost-effective and vital projects efficiently and to tight deadlines. As John F. Kennedy once said:
	When written in Chinese, the word 'crisis' is composed of two charactersone represents danger and one represents opportunity.
	Let us not get entrenched in the economic crisis to the detriment of our defence capabilities, but seize this opportunity to come out the other side with a more effective, efficient and decisive armed force.

Malcolm Rifkind: I hope that the Minister is enjoying his time in the Ministry of Defence. I recall vividly that when I was appointed Secretary of State for Defence, I received a letter from the late Julian Amery, who said, You will enjoy the Ministry of Defence. They spoil their Ministers and make them feel heroic. As Defence Ministers inspect guards of honour, sit in tanks and fly in planes, one can understand what he meant.
	I want to begin by addressing what is, in a certain sense, a paradox. The Government will constantly say, as they have said for many years, that there is real growth in the defence budget and that there has been over the period that they have been in office. Technically, they are correct. They will also maintain that the UK, after the US, spends more on defence than virtually any other country in the world. That, too, is correct. However, one recalls the remark that one can use statistics like the drunk man uses the lamp postfor support rather than illumination. The Minister and the Government know as well as the rest of us that although those statistics might have some technical accuracy, they are combined with equally important facts that were referred to by my hon. Friend the shadow Defence Secretary.
	Over the past 12 years, we have seen a dramatic reduction in the number of aircraft and combat ships and in the manpower of the armed forces. We have also seen the Government's inability to carry out the task that they have appointed for themselves without extraordinary overstretch for the armed forces and an unprecedented use of our reserve forces, to which I shall return in a few moments' time.
	So how does one explain the fact that despite real growth the outcome is so depressing? Part of it, as my hon. Friend the Member for Woodspring (Dr. Fox) said, was that the increase in the cost of procurement projects is vastly greater than any retail prices index might show when it is used to determine the defence budget. That is clearly part of the explanation, but another element has been the continuing and increasing pressure to improvequite rightly, in many waysthe pay and allowances for our armed forces. That, too, is something that we welcome, but it has the consequences to which I have referred.
	However, the Government cannot escape the fact that another part of the explanation is that their policy over the past 12 years has resulted in far greater use of our armed forces in a series of wars, conflicts and operations. That has not been funded simply by the reserve, because it has involved a much greater utilisation of equipment. The fact that that equipment is used far more often means that it has a shorter life and constantly needs to be repaired and improved, and the overall impact has been of a very serious order.
	I freely acknowledgeindeed, I take great pride in the factthat, after the US, the UK and France are the only countries that can claim a significant ability to deploy armed forces around the world. There are larger armiesin Russia, India and China, and so forthbut, for various reasons with which I am sure that the House is familiar, the UK and France remain very important countries. I deliberately include France in this regard because it is comparable with the UK in the sense that both countries are able to match diplomacy with military capability, where that is appropriate. That is hugely desirable but, despite the incredible economic growth we are told we have had over the past 12 years and the huge increase in cash going to the MOD, there has still been extraordinary overstretch in all sorts of ways. If that has been true during the years of plenty, what do we have to look forward to now, given that we have entered a period for which there are extremely lean implications?
	The hon. Member for North Devon (Nick Harvey) said that there was a need for a review at some stage. I think that he is right, but we must clarify what we mean by that. In a sense, I am addressing my comments on this matter to both Front-Bench teams because, although there will undoubtedly be a need for a review, it cannot be only a defence review or limited to our armed forces. Any review must combine the Foreign and Commonwealth Office with the Ministry of Defence in a way that has not happened before. Only then will we end up with a coherent and deliverable policy that does not repeat the mistakes of the past.
	Most of the time, our defence and armed forces are not an end in themselves but the means to an end determined by our foreign policy. Defence is the handmaiden of foreign policy: it is one of the meansalthough not the only oneby which we sometimes have to implement or advance our foreign policy objectives.
	Frederick the Great once remarked that diplomacy without arms is like music without instruments. Over the past 12 years, our armed forces have been used to a degree unprecedented since 1945. Under Mr. Blair, and the trend has continued under this Government, we have had a series of wars. Of course, wars did not begin in 1997, but what has been unprecedented is that most of the wars since then have not been wars of necessity. Instead, they have been wars of choice.
	I do not want to go today into the question of whether the choices were right or wrong. That is a separate issue but, in the past, most of the wars that we found ourselves in were ones in which either we or our allies had been attacked. War therefore became necessary, because no other option was available. However, the wars in Kosovo and Iraq were wars of choice, and the same is true of what happened in Sierra Leone: even though that was a very small combat operation, it was still a war of choice on the Government's part.
	I concede that the war in Afghanistan is more difficult to determine, because of 9/11 and the rest of the background. One could say that it was an intervention of necessity, but in every other respect the operations that have been putting such huge pressure on our armed forces were not imposed on the British Government. They were something no Government could have ignored; they were decisions, right or wrong, that the Government chose to take. If we are in that world, it is crucial that this essential reviewwhether the Government are Labour, or indeed Conservativenot just takes into account the foreign policy that the Government of the day want to pursue, but must actually be based on it.
	I have made no secret of my dislike of the policy of using our armed forces to intervene in other people's wars, but I want the United Kingdom to continue to have a global world role. We have much to contribute to the world and, for the most part, our contribution is highly beneficial, but the worst possible outcome would be for us to continue to have aspirations towards a global foreign policy while we refuse or are unable to provide the means to implement it, in particular its military component, whenever it may prove necessary. That would be the worst of all possible worlds.
	I point out to my hon. Friend the Member for New Forest, East (Dr. Lewis), perhaps more than to the Governmentthey are at the end of their term and we are about to begin oursthat implementing that role will be a crucial requirement. We know that the Government have been reluctant to deal with the comprehensive spending review, no doubt because they have problems not just with defence but with all sorts of areas of expenditure. However, with the exception of health and, I think, overseas development, there would be no ring-fencing of any budget by a future Conservative Government. In a way, I welcome that; it is right and proper that such matters are examined without preconditions and without too many pre-qualifications, but it is crucial that the next Conservative Government deal with the problemas much as the Labour Government have failed toin a way that does not continue the desperately serious overstretch of recent times.
	In the second half of my remarks, which is linked to the first, I shall concentrate on our reserve forces. I declare an interest as I was for eight years the honorary colonel of a Territorial Army regiment. Hearing about the invitation to do that was as much of a surprise to me as it may be to other Members. Normally when someone ceases to be Secretary of State for Defence, the armed forces never wish to see them or hear of them again, regardless of personality or the colour of the Government concerned, so the invitation was unusual and a great privilege. One day I must table a parliamentary question to find out how many Secretaries of State for Defence in the Labour Government were so approached after their term of office. I suspect that the answer would cheer me up enormously.
	The way in which the Territorial Army has been used over the past 12 years has been one of the most serious examples of problems in resources leading to policy decisions that have had, and continue to have, serious implications of a considerable kind. I remind the House that until the Reserve Forces Act 1996, the reserves had not been used since 1945. Such was the legal position throughout those years that there had either to be general mobilisation of the whole Territorial Army or no use of the reserves at all. For example, the Territorial Army was never used in the Gulf war or the Falklands war, because there was no legal basis that would have permitted that without mobilising the whole reserve force. That caused considerable frustration. Many individual reservists, having received splendid training, wanted to be able to use the skills they had been given.
	As Secretary of State, I initiated the policy changes that led to the 1996 Act and I am delighted that we introduced it. However, the Act has been used in ways far different from anything that was contemplated. Under the Act, it was contemplated that it would be possible to use individual units for a particular short-term operation, or to fill some immediate gap to deal with what nowadays we would call a surge requirement for a limited period, but that is not what has happened. There has, in fact, been a continuous use of the reserves in the wars and operations that have continued without interruption since the invasion of Afghanistan and Iraq. In the case of Afghanistan, our involvement looks like continuing for a number of years to come.
	We had better be clear about the implications of that. The Labour Government's general attitude towards the reservists has, I fear, been pretty shabby. One of the decisions that they took in the 1998 strategic defence review was to make a massive reduction in the size of the Territorial Army. It was 56,000-strong at that time; it has 36,000 people today. Over the past 12 years, we have entered the worst of all possible worlds; there has been unprecedented use of our reservists exactly when their numbers have been dramatically reduced to their lowest level for many generations, if not ever. It is that dysfunction and disharmony that are so indefensible, in my judgment.
	Let me give the House figures relating to what has happened since 1997. Since 2003that is, since our involvement with Iraq, Afghanistan and so forth17,000 reservists have been mobilised. That represents 9 per cent. of those mobilised in Afghanistan, and 4 per cent. of those mobilised in Iraq. I draw attention to a particular point: when we passed the 1996 Act, we did not envisage those sorts of numbers. We said that the use of an individual reservist should be such that his or her cumulative exposure should be a maximum of one year in three. That remains, I think, the legal position today. The Ministry of Defence handout Future use of the UK's Reserve Forces, published on 7 February 2005, says, in referring to the massive mobilisation that the 1996 Act never envisaged:
	It is recognised that regular mobilisation of the VRF
	that is, the volunteer reserve forces
	up to this maximum is unsustainable.
	It goes on to say:
	The feedback...is that a limit of up to 12 months' service in aggregate over 5 years is more reasonable unless the individual volunteers for more frequent tours.
	That sounds good; that sounds as if the policy were becoming more flexible. However, the document goes on to say:
	Where possible, this is the level which we intend to apply unless no viable alternative exists.
	In other words, the Government make the concession and make it meaningless, in the same sentence.
	It is not sustainable to continue with that policy. I say that to the Government and, indeed, to my right hon. and hon. Friends, because I suspect that they will have responsibility for the matter in the not-too-distant future. We already know the consequences. Reservists have been voting with their feet. After the Iraq war, between 2003 and 2005, some 15,000 reservists quit, and they have not been replaced. I mentioned earlier that the size of the Territorial Army is 36,000. That is not its authorised strength; its authorised strength is 42,000. The reason it has only 36,000 people is that it has not been able to recruit the numbers required. People have not been willing or able to join in the numbers that the Government presumably think necessary. That should cause serious concern to the Government Front-Bench team.
	I make one final point in drawing to the end of my remarks. It may be said, Well, you know, it is not just reservists whom we have had problems recruiting; the regular forces have had similar difficulties. That is true, but there is a crucial distinction that I do not think has yet been mentioned. Over the past few years, we have gone through a period of very low unemployment. Historically, when unemployment is low, the regular forces have difficulty recruiting to the extent required. For very sad reasons, that will now change. Now that unemployment is becoming a serious problem, it is likely that the regular forces will not have anything like the same difficulty recruiting. Although that will benefit the regular forces, exactly the opposite argument will apply to the Territorial Army. Precisely because unemployment is increasing and getting very high indeed, employers will have not the slightest incentive, when they have such a vast number of people from whom they can recruit, to chose those who, for one year in three, or whatever the period will be, are required by the Government to fill the gaps that they are not prepared to fill through the regular Army.

Philip Dunne: My right hon. and learned Friend is making a typically powerful speech. On the subject of recruitment and retention in both the regular Army and the Territorial Army, does he not think that it is an absolute disgrace that the Government are within a week of implementing a new pay round, and none of our professional men and women in the services have any idea what pay they will be entitled to from Wednesday of next week? When he was Secretary of State for Defence, would he have allowed such a shambolic situation?

Malcolm Rifkind: I would certainly have tried to prevent it, but whether the Treasury would have allowed me to do so is the question that must be addressed. I have not the slightest doubt that the Ministry of Defence could make the announcement today if it were permitted to do so. Another part of Government is creating the problem, and it is a disgrace. My hon. Friend is right to refer to it.
	The Minister was good enough to allow me to intervene on him to raise the review of the reserve forces. I welcome the fact that that review is taking a lot longer than originally intendedI make no complaint about that. However, looking at the review's terms of reference, I am not convinced that those conducting it will be able to address the questions that I have raised today. I hope that they will do soI hope that when the review is published, it will refer to the gross overstretch and misuse of the reserve forces. It is not good enough for the Minister simply to say that individual reservists like going out on operationsof course they do, I have not the slightest doubt about that, but it is not just about their personal interest. Their families and employers are also involved in the process, and the Government know perfectly well that the strains that have developed in recent years have made the current policy unsustainable.
	I simply conclude by saying, first, that we cannot have foreign and defence policies that are not in harmony. Secondly, if the Governmentwhoever they are, Labour or Conservativewish, as I hope they will, to have a world view and a global foreign policy, it is no longer possible to resist the argument that the regular forces in particular have to have the manpower compatible with that aspiration. While the reservists can help and may be used for special occasions, such as surge requirements, and to fill particular gapsthat is what they are there for; I do not have a problem with thatthe idea that they can be a permanent way of supplementing the regular forces and getting regular soldiers on the cheap should never have come into play. It must stop, and the quicker it does, the better.

James Arbuthnot: My right hon. and learnedand, now we discover, gallantFriend the Member for Kensington and Chelsea (Sir Malcolm Rifkind) has just given an appalling portrayal of the defence of this country clinging on by the skin of its teeth.
	Twenty-three years ago, just before I became a Member of Parliament, I sat in the Public Gallery and watched a Secretary of State mesmerising the House of Commons. If I thought that I would immediately follow him on the Floor of the House, after the intervening period in which he served as Secretary of State of Defence and Foreign Secretary, I would have been appalled, and I would have been right. However, it is a great honour to follow my right hon. and learned Friend in a debate on defence in the UK.
	I am afraid, Madam Deputy Speaker, that you may have a little difficulty keeping us in order, because the title of the debate is, at best, not very helpful and, at worst, utterly meaningless. It gives the impression of Dad's Army. While many of our forces are of course deployed abroad, there is also a plucky home guard ready to fight off the Russians if they turn the wrong way coming out of the northern approaches. As a title, Defence in the UK is complete rubbish. The Defence Committee is currently conducting an inquiry into our relations with Russia. I shall confide to the House, hoping that it goes no further, that we do not consider ourselves under imminent threat of invasion.
	We can, of course, in this debate discuss home basing issues, and I intend to say a little about Project Belvedere. We can discuss some of the training issues, in so far as training takes place in the UK, and we have heard from the hon. Member for Vale of Glamorgan (John Smith) about St. Athan, which was a surprise to all of us. But Defence in the UK? Modern defence is not a geographical thing. It rests on industry, which is global, on our alliances, which are global, on our interests, which are global, and above all on our people in the armed forces, to whom I pay a very great tribute, and there are now few of them who stay in the UK for very long.
	Whatever we do has an effect elsewhere. What happens in Pakistan, whether it is an attack by an American drone based in Afghanistan on insurgents in South Waziristan, or the attack on the Sri Lankan cricket team in Pakistan, affects attitudes in the Pakistani community and in other communities in the UK, because the media are global too. Communication is now instant. To distinguish between the UK and Pakistan or Afghanistan is becoming increasingly pointless, since everything that happens there will instantly affect what happens here.
	And that is what this country does not get. It is what this continent, Europe, does not get. They do not understand that leakage of nuclear weapons technology, as has already happened in Pakistan, thanks to A.Q. Khan, is just as likely to lead to a nuclear bomb going off in London as it is to one going off in Islamabadin fact, rather more so. The people of this country, of this continent, do not believe and do not understand that if we allow the region of Pakistan and Afghanistan to become even more unstable than it already is, it is not the Islamic countries that will be the targets of the new rulers of those countries. It will be us, here in the UK, so we cannot afford to fail there.
	But for reasons that my right hon. and learned Friend has just set out so eloquently, it looks as though, in financial terms, we cannot even afford to try to succeed. We are devoting to that particular struggle one twentieth of the number of troops and one fiftieth of the amount of aid that we devoted to the much richer and more stable area of Bosnia. We are using up our kit five times faster than we can replace it. We are fighting a war with a peacetime mentality.
	That is because nobody is effectively proclaiming in this country or this continent that defence is good, that we have the right to defend our values, and that we have the duty to do so. The Secretary of State for Defence recently came out with a reiteration of the defence planning assumptions that is almost identical to the previous defence planning assumptions. There is a sense of treading water. Afghan operations must not mean that the Ministry of Defence or the armed forces will in a few years be trapped in a time warp. There needs to be new thinking now, thinking ahead for future challenges, because they are not even future challengesthey are challenges that we face now. It is just that we have not recognised how serious they are.
	To give him his due, I believe that the Secretary of State for Defence believes in defence. I believe that of the whole defence ministerial team. However, the Ministry of Defence team alone does not have the capacity to deliver on the need to inspire and give the country the sort of warnings that Winston Churchill was giving in the 1930s. It needs the whole Government, including the Prime Minister, to pull in the same direction and they need to take the House, which is now nearly empty, with them.
	This may seem a cheap point, but it happens to be true. To most hon. Members, a defence debate means an opportunity not to discuss matters fundamental to the survival of this country and our values, but to go to their constituencies. Yes, their work there is important, but it is rarely a matter of life and death, as what we are discussing today is. The Government need to take the country with them, but the plain truth is that the absence of Russian hordes in the northern approaches has meant that defence has become something that we have taken for granted and that some people, such as those involved in the Campaign Against Arms Trade, are even uncomfortable with.
	In the House, there used to be three individual service day debates and two days' debate on the statement on the defence estimate. All that became meaningless as the services did more and more on a joint basis, and it rightly changed in the late 1990s and the early part of this century. However, now there are three debates on policy, procurement and personnel, and two more were addedon defence in the world and defence in the UKto make up for the defence estimates debate, those last two being particularly unfortunately named. We need a return to two days' debate at a set time each yearperhaps when the MOD's annual report is issued, so that there can be a useful focus. We need five general days' debate on defence, and perhaps more.
	I said earlier that I would say a little about the basing decision involved in Project Belvedere. For some time, the Ministry of Defence has been considering whether to re-base the Chinook helicopters that are currently at RAF Odiham. In the last debate on defence personnel, I discussed the issue at some length. I shall not do so again today; suffice it to say that the Chinooks should stay where they are. However, I want to say one thing. The Minister said that he was trying to bring the issue to a conclusion as soon as possible and that no decision had yet been made. Today we are having a debate on defence in the UK, and today would be the correct time to announce that the Chinooks will stay where they are. We all know that there is no money and no appetite to move them. The only obstacle in the way of the announcement of the decision, and in the way of some welcome clarity and direction for those who have been abortively slaving away at this ghastly project for years, is chronic indecision. I ask the Minister to make the announcementjust get it over with. He will feel a lot better for doing so, and so will we.
	Frankly, the design and implementation of the joint personnel administration system, or JPA, has been a disaster. Its failings were broadly responsible for the Comptroller and Auditor General's qualifying the Ministry of Defence's accounts. Neither the Ministry of Defence nor those, such as the Defence Committee, who scrutinise it, can see what is going on. Many personnel data are provisional, projected or uncertain and that has been the case for the past couple of years. In its quarterly reports, the Ministry of Defence cannot even properly report against some of its new departmental strategic objectives, because it does not have the necessary data.
	Those failings may sound technical, but they have caused profound unhappiness among service personnel. Today I heard about the case of an Army captain who was posted abroad and was not paid for three months. When he got back, he discovered that his credit rating had been severely damaged. The response was: It's your fault. You should have looked on the internet to see that things were working properly. Well, let us remind our soldiers to take their laptops with them to Musa Qala in future. We cannot treat our soldiers in this way.
	Unless the JPA is sorted out, there will be more grounds for dissatisfaction within the armed forces than it is comfortable to imagine. We need to treat those people properlyin their housing, in relation to their families, in their medical care, in their pay and conditions, and in their life after they leave the armed forces. That is not just because we need them, although we truly do, and not just because they are courageous and effective, although they really are, but because it should and must be a matter of honour for us to recognise and appreciate that they sacrifice everything for their country and for our values. They give us our freedom, and we owe them more than we can express.

Katy Clark: It is a great pleasure to have the opportunity to contribute to this debate. I want particularly to raise two issues that are of great concern to my constituency and have been raised with me by a considerable number of constituents.
	The first issue, which has already been raised by several hon. Members, is Britain's possession of nuclear weapons, particularly the decision to renew and replace the current Trident nuclear weapons system. As the Minister will be aware, this has for many generations been higher up the political agenda in Scotland than in other parts of the United Kingdom. There has traditionally been a far higher level of opposition to nuclear weapons in Scotland, for a variety of reasons.
	From the 1950s, we have had ongoing campaigns against nuclear weapons, so the issue has been very visible in the public eye. Since the 1950s, we have seen considerable shifts to the left in public opinion. Parties of the left are far stronger in Scotland than in other parts of the UK, and social democratic ideas are much more central in the political establishment. There is also the fact that nuclear weapons systemsPolaris, Poseidon and Tridenthave been physically based on the west coast of Scotland, which is our major population base. In constituencies such as mine, we do on occasion see the submarines travelling up and down the Clyde, so people feel that this is far closer to them. That cuts both ways. A number of jobs are provided at the Faslane nuclear weapons base, but there is awareness of and concern about the situation and a debate about whether it is appropriate for Britain to possess nuclear weapons at all.
	I welcome some of the statements recently made by the Government, particularly by the Prime Minister, on the proliferation of nuclear weapons and their possession by countries throughout the world. Those statements are reinforced by what is being said by the newly elected Administration in the United States of America. As the hon. Member for North Devon (Nick Harvey) said, we are moving towards next year's non-proliferation treaty review conference. It is therefore appropriate that the British Government are trying to put this issue far higher up the political agenda, not only because of the new US Administration but because of the greater risks that we all face in the world as the years go by.
	The position taken by the Conservative Front-Bench spokesperson, the hon. Member for Woodspring (Dr. Fox), suggests that his party sees no circumstances whatsoever in which Britain could move towards not having nuclear weapons. My fear for many years has been that many of the arguments made for Britain's possession of nuclear weapons could be used by any country in the world. The implication of those arguments is that any and every country in the world will possess nuclear weapons as time goes on, and that is a world that we should all fear. We need to put moves on restricting and removing weapons of mass destruction at the top of the international agenda.
	Such points have been put to me repeatedly by my constituents, and increasingly in the last few months I been asked whether, given the current difficult economic circumstances, it is appropriate for Britain to be spending something in the region of 76 billion on these weapons. The figure is indeterminate; we do not know exactly what it will cost to replace the current Trident nuclear weapons systems, but we know that historically such projects have tended to end up being more expensive than originally envisaged. Whatever the cost, it is likely to be huge, and given some of the other comments made in the debate about our armed personnel and the support that people receive not just through pay, but when they return home having been in the militaryparticularly those suffering from physical or psychological injurywe have to question whether that is the best use of the nation's resources.
	I place on the record my hope that the Government will look again at the issue of Trident renewal, and use opportunities available in the coming debates on the non-proliferation treaty to consider ways Britain can move to a non-nuclear future, and perhaps more importantly, to use that as a mechanism to ensure that we restrict as much as possible the possession of such weapons of mass destruction throughout the world. Any other position that Britain took would be hypocritical. If we say that it is good enough for us, it is difficult to say that it is not good enough for other nations. In our foreign policy in general, such hypocrisy has damaged us, particularly in the past few years in the lead-up to the Iraq war, and in the repercussions of that war and the war on terror. It would be a significant failing if we continued down that path.
	The other issue I want to talk about is the future of the Defence Storage and Distribution Agency, which affects my constituents and those of a number of other hon. Members. The DSDA was formed three years ago after the Ministry of Defence won an in-house bid in competition with two private sector companies. Indeed, since its formation, another look has been taken at whether the service should be privatised or remain in house.
	There was great concern that in the pre-Budget review before Christmas the DSDA, along with a wide range of other public sector organisations, was named as an organisation that would be looked at again for efficiency savings, and to establish whether it is an appropriate part of the public sector to consider for outsourcing, privatisation or some other model. More than 250 privatisation programmes are running in the Ministry of Defence, and an operational efficiency programme is currently being looked at by the Treasury to determine whether the DSDA should be looked at again.
	Approximately 350 people are employed in a military depot in my constituency by DSDA, and there is a great deal of concern about the proposals. I have written to the Secretary of State and asked him, along with Treasury officials, to meet the relevant staff trade unions to talk through the process. I have also asked them to meet not just myself but other interested MPs in whose constituencies affected depots are sited, on a cross-party basis. We understand that there might be some kind of announcement on the issue in the Budget, so I ask Ministers again whether such a meeting could be set up.
	One frustration is that since the announcement, it has been difficult to get information about the process. This might be an early stage, and there might not be a huge amount of information to share, but there is concern that there might be an announcement in the Budget when staff have not had an opportunity to take part in the process. Will Ministers get back to us on that, either in the debate or in the next few days, and will they meet the relevant Members? There is a great deal of concern, given the Ministry of Defence's history on the issues of privatisation and job security. I therefore ask Ministers to reconsider the matter, and I would appreciate it if they would come back to us with some dates for a meeting.

Ann Winterton: It is a pleasure to speak in what has so far, quite rightly, been a wide-ranging debate. I begin by paying tribute to those who have given their lives in the service of this country since the last defence debate, and to their families, who are left to bear the burden for a very long time.
	There have been some excellent speeches, not least from my hon. Friend the shadow Secretary of State, although I am rather concerned that he did not make the point that we are living in the deepest recession in my lifetime, which will severely restrict his hopes and aspirations for future defence policy. There will be slippage in many programmes and in the amount of money that the current Government have committed for the future. Those problems will land in the lap of the next Secretary of State.
	I do not disagree in any way with my hon. Friend on the principle that, as well as being able to fight counter-insurgency wars, we need to be able to tackle what I call conventional, state-against-state warfare. As a down-to-earth person, however, the question that comes into my mind is how Members of all parties think that that can be paid for. The current Government will not be holding the reins, because I do not believe that they will be returned to office at the next general election. That very difficult question will therefore have to be dealt with by the Conservative party, if, as I hope, we are on the other side of the House.

James Arbuthnot: Does my hon. Friend believe that the problem that she has set out was significantly exacerbated by the announcement in December of, in essence, the postponement of all major defence procurement decisions until just after the next general election?

Ann Winterton: That is the point that I was seeking to make, and my right hon. Friend has made it much more succinctly. Of course, he is absolutely correct. Decisions are being made now, but the payment problem will not arise until after the next general election. That will exacerbate the situation by limiting the choices of an incoming Government.
	No one in this House or the UK doubts for one minute the bravery, determination and skill of our armed forces, but we as a nation have failed in our engagement in Iraq, and although heavily committed in Afghanistan, our forces are struggling from a lack of appropriate equipment, especially protected vehicles and air power. Iraq and Afghanistan are two wars for which the United Kingdom, and more specifically the Army, was totally unprepared in terms of both weaponry and training. On more than one occasion, I have welcomed new kit, which has proved most excellent, but we still lack sufficient numbers of protected vehicles, helicopters and airlift capacity. Both training and weaponry have been more suited to conventional warfare than to the sort of counter-insurgency operations to which our troops have more recently been committed. The United Kingdom is now too small, militarily speaking, to engage well in both conventional and counter-insurgency warfare. We have recently been most heavily involved in the latter, and given the present instability in various parts of the world, that is unlikely to change in the near future.
	The future Army structure, for which the Army has been completely reorganised, is concentrated on a medium-weight capability based on airlift. With the life of the Hercules C-130K coming to an end in 2012 and the J-type not due in service until 2026, combined with the A400M programme looking extremely dubious, a hopeless mess is likely in a few years unless a decision is taken in the near future. Otherwise, some difficult decisions will have to be made by an incoming Government. It is highly likely that not one A400M will be delivered within the framework of the contract for the whole order of 25 aircraft. The Minister will not disclose in answer to my parliamentary questions what the penalty clauses are or who will pay the damages for late delivery. I should have thought that quite an important point.
	Nor is the problem the much quoted lack of funding. We need only look at the Merlin helicopter as an example. According to RAF presentations, it is a superb aircraft, and I do not doubt that it is in certain circumstances, but it is also very expensive. The six Danish aircraft cost the United Kingdom 29 million each; the RAF Mk 3 costs 19 million, and the Royal Navy Mk 1 costs a cool 39 million, and their running costs are 34,000 and 42,000 per hour respectively. Yet the Merlin cannot fly in Afghanistan without, according to a parliamentary answer, a 1.8 million upgrade to each aircraft to fit new bladespresumably Carson bladesbecause the aircraft cannot fly hot and high, which the Huey helicopter could do more than 40 years ago in the Vietnam era.
	Following the fanfares extolling the excellence of the Pinzgauer, WMIK and Jackal vehicles, their safety has been promoted by quoting their respective speed, off-road performance and manoeuvrability, and yet we find that they are now being used for convoy patrols. When I have tabled questions to the MOD about this, the reply has always come back that that is due to the choice of commanders. I bet, however, that it is a case of Hobson's choice: that is the vehicle with which commanders have been provided, and they have no choice but to use it or walk.

Kevan Jones: The hon. Lady misunderstands the nature of the convoys that take place in Helmand province. They go over not tracked and tarmacked roads, but wadis, deserts and difficult terrain, which is the function that the vehicle is designed to carry out.

Ann Winterton: I am very grateful to the Minister. In fact, most of my information comes from the people who have performed all those tasks in Afghanistan. That is what I have been told by them, and sometimes I prefer to rely on what they say.
	Commanders do not have a choice.  [Interruption.] No, they do not have a choice in every circumstance. If the Minister wishes to intervene and say that commanders have a choice of vehicle on every single occasion, I shall be grateful to him.

Kevan Jones: The hon. Lady's point was that the vehicles were being used in convoys, and that that is not the purpose for which they were designed. I was in Afghanistan three weeks ago and saw convoys crossing deserts, wadis and other difficult terrain. It is simply not the case that these vehicles were not designed to perform that role in Afghanistan.

Ann Winterton: The Minister has completely ignored my request for reassurance about the choice available to commanders in the field. That is because he knows that they do not always have a choicethat, in fact, they rarely have a choice.

Kevan Jones: I am surprised by what the hon. Lady is saying, because I know that, like me, she is something of an armoured-vehicle anorak. She is aware of the range of vehicles currently in operation in Afghanistan that the Government providedindeed, during our last debate she congratulated the Government on them. The ultimate decision on the ground, however, is for individual commanders. It would be wrong of any politician, including me, or of anyone else to start to direct what our commanders should do operationally and which equipment they should use. They have a range of equipment, which is there to be used.

Ann Winterton: The Minister has not been able to reassure me that commanders have a choice, because we know perfectly well that they do not. I have praised the Government in the past for their procurement of many protected vehicles, but there are still so few Mastiffs and there will be so few Ridgbacks when they come into service that, in reality, as I have just said, there is no meaningful choice. It is time that Ministers came clean and admitted that the decision that there would, in effect, be no choice was made at the top. Providing a choice of suitable vehicles would undoubtedly interfere with the long-term strategy for future conventional warfare.
	I am not convinced that a defence review is necessary. I believe that it would merely kick the whole subject into the long grass once again. We know what the problems are today. Incoming Governmentsall Governmentsare there to make decisions, and to justify them in the light of circumstances and the money that is available at the time. As we all know, however, the United Kingdom has committed its forces to counter-insurgency warfare of the most difficult and treacherous kind, and that should at present be its first priority. Surely, therefore, the UK has a moral obligation to provide the very best and most appropriate equipment to protect the lives of our fighting men and women. If it cannot or is unwilling to do so, it should withdraw from those engagements and never again commit the lives of our armed services to similar situations.
	The United Kingdom used to be the very best at counter-insurgency operations. We used to excel, but to be successful in the future, as we undoubtedly were in the past, requires us to rededicate ourselves and provide the means to reinforce our will to win. We must make a decision soon about the type of future war to which we will commit our troops. In other words, we must decide in which direction we wish the Army and other services to go. Having made that decision, we must ensure that sufficient funding and equipment are available at the outset of any campaign. Finally, we must make the vital decision to remain an independent United Kingdom force, rather than become merely part of a European Union force, with all that that implies militarily and in relation to procurement. If we do not make those right decisions, the back of the British Army will be broken; and that is not a situation that I, for one, would find tolerable.

David Kidney: I apologise most sincerely for missing the first two Front-Bench speeches, but a pressing constituency matter kept me from the Chamber longer than I had intended. I have already heard some excellent speeches in the debate.
	Like other hon. Members, I was spitting mad when I saw the images of that despicable protest at Luton against soldiers taking part in a homecoming parade. Those soldiers had returned from places of danger, where they had put their lives on the line. They had probably seen or heard of friends and comrades who were killed most violently while they were there. Some soldiers return with horrendous injuries, including the loss of limbs. As soldiers, all those people endure those experiences on our behalf and for our nation, to uphold our democracy and our rights. Those rights include the right to protest and freedom of speech, which were abused on that day in Luton.
	I will counter that with an entirely different account from Stafford. Some hon. Members may remember that when we debated the subject last year, I described the procession through Stafford in 2008, when the newly reformed 22 Signals Regiment and the long-serving RAF tactical supply wing in Stafford were both granted the freedom of the borough. There was a procession and parade in the town centre, and the streets were lined with members of the public, who cheered and warmly welcomed the troops who participated.
	On 28 February 2009, the same 22 Signals Regiment was newly returned from six months' duty in Afghanistan. The town celebrated the regiment's safe homecoming with another parade through the centre of Stafford ending in the market square. I am pleased to report to the House that the crowds that lined the streets were even thicker and more voluble than last year in their support for the soldiers. Later in the day, I had the opportunity to talk to some of the soldiers and their families who had taken part in the parade. Many of the soldiers expressed how strongly they had been moved by the presence of so many members of the public welcoming them back to Stafford. One young man said that it was the most moving event of his life.
	I will discuss further the welcome that the military receive in Stafford later in my speech. The other part of my speech last time concerned Operation Borona, which involves the return of thousands of soldiers to Britain from bases in Germany.

Julian Brazier: I commend what the hon. Gentleman has just said, as I am sure that the whole House does. The downside of the growing concentration of our regular forces on a small number of so-called super-bases is that events such as he describes are gradually ending. Some of those super-bases are located in places such as Catterick, where there is no civilian population.

David Kidney: I agree with the hon. Gentleman. It is never a good thing to put all the eggs in one basket.
	On Operation Borona and troops coming home from Germany, the Government's emerging thinking about the so-called super-garrison, at least in the west midlands area, is not to try to shoehorn thousands of extra troops into one base, but to provide a range of places within a locality. In the west midlands, for example, the potential sites for those soldiers include MOD Stafford, Cosford and Shrewsbury. As will become clear a little later, the base in Stafford is not remote and is part of the town. One reason why soldiers have found the civilian population so welcoming is that soldiers and civilians live cheek by jowl in the town. Will the Minister say a little about the emerging thinking on venues in the west midlands for troops returning from Germany under Operation Borona and about the present thinking on Cosford, Shrewsbury and Stafford?
	My hon. Friend the Member for Vale of Glamorgan (John Smith), who represents St. Athan, discussed the location there of much of the defence training college work on engineering and technical services. I understand that that includes moving training from Cosford to St. Athan and that, at one time, the thinking was that Cosford would therefore become available to provide some of the accommodation. I am unsure whether the plan has completely changed or whether the process of moving people from Cosford to St. Athan is taking longer than anticipated, but I understand that it is no longer possible to place troops coming home from Germany in Cosford as swiftly as was suggested just 12 months ago, in our last debate on this subject in the House. I therefore ask the Minister to say something about what that means for Stafford. At what pace might we expect more soldiers to return from Germany and be based at Stafford, rather than somewhere else?
	Let me say a little about Stafford and its welcome for the military. There are now Gurkhas among the soldiers of 22 Signal Regiment who are with us. It has been a delight to see how the people of Stafford have taken to their hearts Gurkha soldiers and their children, who are now in our schoolssome of them needing and receiving some support with English as an additional languageand how warm and welcoming the people of Stafford have been to Gurkhas' wives, who have joined us and want to work in our local community. Some of them have needed support with English as a second language, too, and it was a joy to me to hear the principal of Stafford college say that, whether or not he got funding, they were going to get that help for free at his college. That was a great contribution by that college to the warmth of the welcome to our armed forces and their families in Stafford. Many of the Gurkhas' wives have now been helped into work in the local community by Jobcentre Plus.
	The new forces have been integrated into Stafford very well. As Members would expect, however, there is a growing challenge in accommodation. The accommodation provided for service personnel on the base is full, and there is a question about how we provide more accommodation, especially if more troops are coming to Stafford. Accommodation off the base is also an issue. Some soldiers and their families will want to buy homes locally, and people who want to stay in the area after they retire from the Stafford base will also want homes in Stafford. Clearly, whatever else happens in terms of population growth in the west midlands, we are going to need more homes for soldiers and their families in the Stafford area.
	Now is a crucial time in Stafford. We are at the point when the local authority, Stafford borough council, is consulting on its local development framework, which includes where to put more houses. As all Members know, whenever there is talk of putting more houses anywhere, existing communities have great concerns about where those houses might go. That is an important message for the planners of Stafford to remember, but so too is the fact that there will have to be more homes because of the growth of the base at Stafford. Defence Estates must engage now with the planners at Stafford borough council. I am pleased to say that the news that comes to me suggests that that is happening, but it is important that they keep at it.
	That is the main point I wanted to make in the debate, so I shall now finish where I started, by stressing the warmth of the welcome for the military in places such as Stafford. Later this year, we will have the first armed forces and veterans day. The month after that, there will be an open day at MOD Stafford. I am certain that the warmth we saw from the public towards our military in Stafford town centre on 28 February will be repeated on that day in June, and repeated again on that day in July, and long may that be so.

Julian Brazier: May I start by paying tribute to the 5th Battalion The Royal Regiment of Scotland, better known as the Argylls, and the 3rd Battalion The Princess of Wales's Royal Regiment, a Territorial Army unit, both of which are based in my constituency? The Argylls returned from Afghanistan with one young man killed and their commanding officer severely wounded, but despite that he is still commanding the regiment while recovering from an extremely bad gunshot wound. There were other wounded among the ranks of the Argylls and the soldiers of the 3rd Battalion TPWRR, who went to serve with them. Canterbury is extremely proud of them.
	Despite the title of this debate, it is inevitable that all speakers will be tempted to stray into operations outside the UK, but I wish to make a wider point. The shadow Secretary of State made the point that defence planning assumptions are never right, whoever is in charge; one can never gaze into a crystal ball. It is worth reflecting on what a large proportion of the operations we have been involved in over the past 100 years were wholly unexpected. Had we been sitting in a debate of this kind in 1914it is interesting to read the record of House of Commons debates at the timewe would have found that all serious opinion, or very nearly all of it, was focused on the homeland. We would have been talking about defence in the UK, because the crisis in Ireland was so bad, with guns being run in huge numbers into the island by those on both sides of the argument. Those who talked about the possibility of a continental war were thought to be eccentric.
	In 1982, nobody expected the Falklands war the week before the Argentines attacked the islands; in 1990, we had ruled out, only three months before the first Gulf war, the possibility of deploying armoured vehicles outside the NATO area; and, of course, today's operations were wholly unexpected on 10 September 2001. I could give other examples, but the fact is that, with the one important exception of the second world war, nearly all the large-scale operations in which we have been involved were unexpected a relatively short period beforehand.
	That is why I say that although I listen with huge respect to all those who are rightly saying that we owe it to our forces to do the best possible job in supporting them on existing operations, it would be a disaster if we ever designed our armed forces entirely around existing operations. In his excellent speech, my right hon. and learned Friend the Member for Kensington and Chelsea (Sir Malcolm Rifkind) touched on a paradox that we face. We seem to be increasingly widely committed and there are so many threats out therea number of colleagues have talked of threats outside this country, but there are some clear and distinct threats that particularly concern us todaythat whoever is in government will face a huge mismatch between the resources that realistically will be made available and the potential demands on them. I make no apology for saying that the reserve forces play an extremely important role in other English-speaking countries in squaring that imbalance, and they could play a bigger role here.
	Although my right hon. and learned Friend gave a brilliant summary of the problems in the reserve forces, I disagreed with him on one area. For the moment, however, I wish to pay tribute to the Government and to the Minister for the Armed Forces in particular. This small-scale but thoroughly worth while review, which was largely his brainchild andperhaps I know more than I should dowas pushed through despite considerable opposition within substantial elements of the Ministry of Defence, both uniformed and civilian, has shed some light on opportunities missed and on things that need tackling. I very much look forward to seeing it come before the House, and I welcome the comment that there would be an oral statement and that, courteously, the team would be brought to meet the all-party group so that we can have a full discussion on the detail.
	I think that General Nick Cottam did an extremely good job, although I pulled his leg quite publicly on disappearing to St. Paul's just before the job was finished, in engaging with the reserve forces. He and his team got round and talked turkey with people making huge sacrifices on what was, after all, a secondary activity for them. None the less, that activity resulted in almost exactly one in every 1,000 on operations being killed in action, and we would do well to remember that; I believe that the tally is 17 at the moment16 Terroritorials and one air reservist.
	I will not repeat the statistics showing the large role that the reserve forces, despite their proportionately small size, have played in Iraq and Afghanistan, and earlier in the Balkans. Instead, I wish to focus on how an imaginative, forward-looking Government could make more use of reserve forces to square the resource circle. Reserve forces cannot solve the problem entirely, but they can contribute to the solution.
	Compared with the other major models for all-volunteer forcesthe US, Australia and Canada, but not France, where that model is newwe have a much smaller proportion of reserve forces. Broadly speaking, half the land forces in those countries are reservistthe figure is just over in the US, and just under for the other twoand their air and naval reserves are very large, whereas ours are very small as a proportion of the total.
	I have four examples to give. First, 2 Signals Brigade exists to provide communications in the event of a nuclear strike or a major disruption, such as after a large-scale terrorist action. The brigade is not used for operations and sends relatively few people to operational theatres because it has a niche capability that we do not need for current operations. Hon. Members should consider how much less expensive 2 Signals Brigade is than keeping that capability within the regular forces.
	Secondly, whyat a time when there is so little money and so much more that needs doingdo we retain air defence regiments in the regular Army? I know people will say that they can be used in a different role in operational theatres, but they have a niche capability and, while we should retain it within the British armed forces, the likelihood that it will need to be used in the near future is very low. In fact, I suggest that the possibility of a major terrorist strike that disrupts our communications is more likely than the need to fight an enemy with a superior air force in the near future. Have we thought about how we could release funds for other desperately needed priorities if that role were given to the reserve forces?
	My third example is mine clearing. Traditionally, that was performed mainly by the Royal Naval Reserve, although of course some capability is needed in the regular Navy. It is an odd function, because most of the time, even on operations, it is not needed, but when it is needed we need a lot of it in a hurry. The two most obvious areas for our focus would be if the situation in the Gulf took an unexpected turn such as in a confrontation with Iran. I know from having worked in that region that there is an enormous area of very shallow water, where mine warfare could easily be conducted. The second is the waters around the UK, which is the subject of today's debate. Many of our ports have long, shallow approaches.
	How is our mine warfare capability currently organised? Almost all of it is within the regular Royal Navy. Therefore, I would argue, we have the worst of all worlds. We have expensive mine-clearing vessels, which carry people with very important skills, many of which are widely available in the civilian world, including deep-sea diving, survey work and so on. Each vessel has one, very expensive regular crew. If some vessels instead had two or three reservist crews, they would be much cheapera reservist crew is roughly a fifth of the cost of a regular crewand, crucially, we would have a surge capability. God knows, mines are easy to lay these days, and if there was a mining threat and we had to try to clear all our major ports at onceif a couple of mines had gone off, we would not know where the others werewe would be able to work the vessels round the clock, which cannot be done with a single crew, especially as some of the skills involved, such as diving, are very tiring. An individual can dive for only a few hours a day.
	My fourth example concerns unmanned aerial vehicles. I have not had time to pursue this subject matter through parliamentary questions, but somewhere there is a bit of a story about cost overruns, with which I suspect the Minister is familiar. Very small numbers of UAVs play a significant role in Afghanistan. They are very expensive and, I am told, the exercise is turning into rather an expensive one to man. I suggest that that is an area where reservists would be idealthe skills involved in operating a UAV are widely available outside: hand-eye co-ordination, understanding of IT systems and a range of other skills in which it would not be difficult to train reservists. There must also be opportunities, particularly if we need a surge capability, to think about how we can transfer that role, at least in part, to the reserve forces, as we proposed in our all-party group report.
	I have given four specific examples; let me now give a general one. To my mind, it is quite astonishing that our air reserves are so tiny. The Americans have a third of all their fast jet fighter formed units and getting on for half of all their pilots in their volunteer reservethat is, the air national guard and the US air reserve. In the Air Force, we have a total of 28 reserve pilots, nearly all of whom are Hercules pilots. That is all. A phenomenal investment goes into training a pilot, even before we think about fast jet pilots and if we consider only helicopter training. The cheque is torn up, in Britain, as soon as the man leaves the service. The Australians and, in particular, the Canadians have made slightly more use than we have of their flying reserves and the Americans have made vastly more use of them. There must be more scope for this.
	The Territorial Army has a highly successful small helicopter regiment that will be disbanded in a few months' time, which seems extraordinary to me. The Navy has a very well developed air reserve, with more pilots than the Royal Auxiliary Air Force. Few people from the air reserve have been deployed in operations, although one or two have, but its members have played a significant role in substituting for regulars and saving a lot of money in the training pipeline.
	Unbelievably, the Royal Naval Reserve officer who commands the air reserve, which has been consistently up to strength, has been downgraded by one rank. His regular staff officer is being taken away, and the next stagewhich will mean that he will be unable to do his jobwill be his replacement by a regular officer. The Royal Navy has, shamefully, already decided to replace the commander of the Maritime Reserves with a full-time regular officer who had never done a civilian job. It is no criticism of the individual concerned to say that that will not provide leadership to people who are giving up their free time or provide understanding to his regular brother officers in the RNR about what royal naval reservists can do.
	The situation in the volunteer reserves at the moment is, in many areas, fairly dire. I agree with most of what my right hon. and learned Friend the Member for Kensington and Chelsea said. In a recent presentation to the all-party group, Air Vice-Marshal Paul Luker, who is an ex-regular and the chief executive of the Council of Reserve Forces and Cadets Associations, commented on an establishment of 42,000, although he said that the true figure is probably not much over 30,000. He said that officer recruitment was generally poor and that it was proving difficult to maintain the officer corps, which is at the absolute heart of a successful service. He also said that he was concerned that some aspects of recruiting were so focused on the next operational tour that it was losing sight of building the unit and nurturing the cadre of officers and NCOs needed to maintain its ethos and cohesion. He said that that was particularly true of the Royal Marine Reserve and the Auxiliary Air Force squadrons, which had been used even more heavily than the Territorial Army. I welcome the review, which I think will provide some modest steps in the right direction. We are all anxiously waiting for it.
	I turn now to the One Army Recruiting process and its two single-service counterparts. Paul Luker said that the process was not really delivering. In the old days, the reserve forces and cadets associations ran recruiting, and he did not make a bid for that to be restored, but I firmly believe that, although centralised recruiting can lead to significant economies of scale in such matters as the purchasing of television time and so on, the remaining local element of recruiting should be given back to the RFCAs. They have the peopleon their council, or in the media and local communitieswho have the feel for local areas that regional brigades do not.
	The local regional brigade commander in my constituency is excellent. Indeed, he is one of the best people to have held that post in all the time I have been the MP, but the occupant of that role is changed every two years. The result is that no one, however good he is, can have quite the same relationship with the community.
	We need to address the issue of officer training, some of which can be done very cheaply and easily. In the Officer Training Corps, the University Royal Naval Units and the University Air Squadrons, we have a substantial resource that we do not tap sufficiently. Very little effort is made in the central planning undertaken by the Army and the other two services to make use of them for the volunteer reserve.
	I was very proud to see my son, a medical student at King's, pass out of the first phase of the London OTC. It was a family occasion, because the commanding officer was his first cousin once removedthat is, my wife's first cousin. However, it is a measure of how much the Army has lost its way in respect of the OTC that my son has been told that choosing to sign up for a cadetship would mean that he would be required to leave the that splendid organisation. The reason is that he might be subject to an operational deployment, which would cost him a year in his planning.
	The solution, as we said in our report, would be for the senior Army medical staff to get off their buttsif the House will forgive the expressionand sort the problem out with the royal colleges. That would be better than the present situation, which is that they just say, Well, people serving in TA medical units can suffer from that, but we are not having our regular Army people, including cadets, suffer in that way.
	I want to focus on the OTCs for a moment longer and try to explain what I mean. Coming through a typical OTC are large numbers of very keen young men and women, a few of whom will join the regular Army and some of whom might make good Territorials. However, whereas the arrangements in a university regiment in Australia or in a reserve officer training corps unit in America are closely tied into the training cyclefor the Army Reserve in Australia or the National Guard in Americathat is not the case here.
	For example, a person who has served with the OTC, completed a commissioning course from Sandhurst and wants to do a special-to-arm course cannot schedule it to fit into the same university vacation. Such a person cannot therefore get right through the system while at university, but the Americans and Australians have recognised that students are short of money but rich in timeexactly the opposite of what they will experience afterwards. With proper organisation, we could have an officer corps whose members were very well trained when they reached the end of their time at university.

Richard Bacon: I apologise to my hon. Friend for not being here earlier, but I saw his name on the monitor and came in. I joined the Territorial Army when I was at university, for the adventure and experience that it would give me and because it meant that I could work on Sundays as well as Saturdays at a time when I needed the money. Had I had the opportunity to do much more training, I would have taken it.

Julian Brazier: Yes, my hon. Friend is absolutely right. With very little expenditure, we could do a great deal to fix our officer training.
	I have talked about recruitment. I end with what is at the heart of the problem of retention of officers and senior and junior NCOs in the Territorial Army. As a result of the reserves review, the word offer has come into the vocabulary. If we want people to give up their time and to face serious penalties in their civilian career, what are we offering? The answer has to be: worthwhile and interesting commands, opportunities to train with those commands, whether it is a corporal commanding a section or a major commanding a squadron or company and, in extremis, the opportunity to take those commands on active service on an operational tour. That is why the National Guard almost always deploys formed units.
	There is terrific tension in the MOD between people who recognise that and those who see the TA simply as a feeder to pad out regular units. The Royal Marine Reserve, which has had some outstanding people, including Corporal Matt Croucher, who received the George cross, has chosen to go entirely down the latter route. That is why the RFCA identified the RMR as having serious trouble in retaining officer and NCO structuresits fabric is under threat. Ironically, some other units that one might think comparable, such as 21 and 23 SASI was privileged to serve with 21 SAS some years agoand 131 Commando squadron, the sapper unit that supports the Royal Marines, have all gone down the route of sending formed sub-units commanded by volunteer reserve officers, and they have all done exceptionally well. One of 131 Squadron's more ambitious operations in the Gulf got on to the front page of  The Times. I cannot give more detail but the special forces regiments have taken decorations, as the Minister knows.
	The future for the reserve forces lies in formed sub-unit deployments, although they can also provide limited padding for regular units. That brings me to my last point, which is the only one where I disagree with my right hon. and learned Friend the Member for Kensington and Chelsea. He said that the reserve forces provided only surge capability, but that they were very good at it. I would go a little further. The reserve forces are willing to go on being used in continuing operations if they are used in the right wayprovided they have the resources and, crucially, provided they have the support in the local community that is present in America but is, I fear, pretty indifferent in Britain. Reserve forces are there to support the regular forces, but to do that job they need resources, training, an officer corps and the support of the country. I look forward to the Government's reserves review.

Robert Key: It is a particular pleasure to follow my hon. Friend the Member for Canterbury (Mr. Brazier), not just because he and I both have the privilege of representing very fine cathedral cities, but because he has unrivalled expertise in and practical knowledge of our reserve forces. It was also a pleasure to listen to the hon. Member for Stafford (Mr. Kidney), because over many years the Staffordshire Regiment was part of the backbone of the infantry, just as in its day, once upon a time, the Wiltshire Regiment was tooit is now part of the Rifles.
	I shall concentrate more on the civilian side of defence in the UK. We face a paradox. When I was a child growing up in Salisbury in the 1950s, a substantial proportionperhaps 20 per cent.of the people on the streets, particularly at weekends, would have been in uniform. In a garrison town, surrounded by garrison towns on Salisbury plain, I recognised the importance of the military and may even have taken it for granted. Now, Her Majesty's forces have as much popularity, status and respect as at any time since the 1950s, when of course they were regarded as the saviours of our country, which indeed they were. Now, they again enjoy great status.
	Perhaps the Royal Navy, as the senior service, does not enjoy as much status as the other forces, simply because people in the Navy are more restricted to their home bases. However, if one visits Estonia, as I did earlier in March, one finds that the Royal Navy is held in the highest regard there. Its visits, such as the visit of HMS Illustrious to Tallinn later this year, are anticipated enormously by the whole population, not least because the Royal Navy helped the Estonians in their independence war in 1919. The Royal Navy should have more status. People do not recognise the purple role that it plays now, or how prominent it is in running our operation in Afghanistan. It may have fewer ships than it did but, my goodness, it is proving its expertise, not just at sea but in military theatres generally.
	I want to mention rehabilitation for Her Majesty's forces at places such as Headley Court near Leatherhead. The need for a special swimming pool there led to the remarkable establishment of Help for Heroes by my constituents, Bryn and Emma Parry. It has caught the imagination of the nation. It started with a swimming pool and it has grown and grown. The attention that we are at last beginning to give to stress disorders and mental disorders among serving and former members of Her Majesty's forces has led to new support for Combat Stress, for example. The Army Benevolent Fund has never been busier, along with the Army Families Federation and its sister organisations for the Royal Navy and the Royal Air Force.
	Of course, the respect shown in local communities as coffins are borne from RAF Lyneham in Wiltshiremy hon. Friend the Member for North Wiltshire (Mr. Gray) will know a great deal about thatis reflected throughout the country in the welcome home parades for soldiers returning from active service held in many of our towns and cities. Only last weekindeed, the process finished this weekwe reformed legislation governing the way in which Her Majesty's coroners carry out their duties with regard to military inquests. We can at last say that we are doing the decent thing by military families.
	On 27 June, we will celebrate armed forces day. Flags will fly throughout the country for the whole of that week, and we will show our appreciation. Yet when the pollsters and focus groups report their figures, that support is not translated into political priorities, so political parties do not respond by giving defence a higher spending priority. For example, the Ipsos MORI poll of October 2008the latest one that I have been able to findfound that over four fifths, or 81 per cent., of British adults say that they are favourable towards UK armed forces. That is the highest figure that MORI has recorded since that tracking study began in 2003. Only a tiny minority3 per cent.are unfavourable. Some 52 per cent. support the UK armed forces' presence in Afghanistan, while just over a third35 per cent.oppose it. Some 43 per cent. support the UK armed forces' presence in Iraq, and 45 per cent. do not. Levels of support for both those operations are higher than they were last year.
	It is interesting that a distinct divide appears to have emerged between civil society and the military. There is much greater casualty sensitivity in the west than there was. There has been a growing polarisation of religious belief across the world. There is growing concern for universal human rights across the world, and prosperity has emerged as the overriding socio-political value when considering defence, rather than territorial gain, or Russian tanks rolling across the north European plain.
	Although the public's attitude to war is less positive than it was, public support for the armed forces has generally remained consistently high. As Peter Riddell commented in the  Royal United Services Institute Journal in February last year,
	Insofar as there is a gulf
	between the military and the public,
	it is of ignorance, not sympathy or support.
	So it is an extraordinary paradox that defence of the realm is way down the list when it comes to why people vote for a particular party. I hope that that is not a reflection of the fact that most of the time in the House of Commons, defence is regarded as a bipartisan issue. It certainly is on the Defence Committee. That is an extraordinary situation.
	The present position, which we all recognise, of overstretch and underfunding, as regards both people and procurement, means that we have to take a long view of how we got to where we are, and where our nation and our military are going in future. Our history and heritage teach us, and economic necessity demands, that we sustain and pay for our armed services to be trained and equipped for high-intensity warfare with global reach, complemented by a strong diplomatic servicea comprehensive approach, as we are learning to call it. Both should be underpinned by increasingly sophisticated security services and intelligence networks.
	The British have taken their language, ideas, trade and armies around the globe for many hundreds of years, but gone are the days of empire. The legacy is there, but we are not stopping and withdrawing to our island. The reason is straightforward: British forces are needed to protect UK global interests in trade and shipping. More than 90 per cent. of our imports come in by sea, and those trade routes and vessels must be secure against foreign state intervention, as well as terrorism and piracy. That is why our forces must have global reach, and that is why they need aircraft carriers. They must have power projection by land, sea and air, and that must include amphibious capability and unmanned maritime systems, increasing use of unmanned combat air systems and space-based remote sensors.

Julian Brazier: My hon. Friend is making a powerful point. Does he agree that all those goods by definition end up in British ports, so we must have the capability to keep those ports clear of mines?

Robert Key: Yes, of course. I was extremely interested in that part of my hon. Friend's speech in which he talked about the importance of clearing and detecting mines around our shores. That issue deserves far more attention and research, and we must undertake, too, practical detection and destruction of those mines. Doubtless, we shall return to the matter.
	There are new aspects to defence that we did not think about very much before the last decade. We have to think afresh, as we and other European nations need to define our defence in new terms. Obviously, homeland security and territorial defence are vital, but increasingly we have to think in defence terms about energy infrastructure protection, from gas and oil pipelines to wind farms and nuclear power stations. While the politics of energy may dominate in our part of north-west Europe, there are other parts of Europe where the politics of water and food is increasingly important. As the climate change crisis climbs the political agenda, carbon emissions will threaten peace and stability. Poverty and economic migration already cause great friction between statesthe day of state-on-state war is not necessarily over.
	I should like to turn to some of the extraordinary things going on in the UK against all the odds to improve the equipment used by our armed forces. I should like to begin in my own constituency at Boscombe Down airfield, which I visited only last Friday, where I saw for myself the extraordinary work of the dedicated and experienced work force that is under way to convert the eight Chinooks, for which we have been waiting for so long. The Sea Kings are being fitted with Carson blades, which will allow them to be used in Afghanistan and elsewhere, and the Nimrods are being worked on.

Gerald Howarth: My hon. Friend referred to the eight Chinooks that are being modified in his constituency. There is a rumour going round that perhaps only one of them will be available for deployment by the end of the year, but it will not have full operational capability. It will be put into theatre merely to prove that it can be done. From his knowledge, is my hon. Friend in a position to comment on that, or should I ask the Minister?

Robert Key: I fear that I am not in a position to be able to answer that. If I could change places with the Minister after the general election, doubtless I would find many Chinooks flying operationally.
	I saw, however, that real progress has been made on that programme, and there is a huge determination on the part of the work force at Boscombe Down to ensure the highest standards of workmanship. People do not realise the complexity of those helicopters. Stripping down and replacing the wiring means replacing 20,000 wires per helicopter. It is an extraordinary undertaking.
	I mentioned the Nimrods. Then there are the unmanned aerial vehicles, which will increasingly be seen in the skies over south Wiltshire as we introduce the training regime led by the Royal Artillery in order to deploy UAVs operationally and in infantry tactics.
	The science and technology apprenticeship schemes at Boscombe Down are a splendid innovation. When I was first elected to the House, every year I had to present the prizes to the apprentices at Boscombe DownRAF Boscombe Down, as it was then called. There would be 50 or 60 apprentices a year. Then there were years with none. Now, I am glad to say, they are coming back. There will be more than 20 apprentices this year. That is a great compliment to QinetiQ and to the work force at Boscombe Down.
	Only an hour or so ago there was an announcement from an important defence procurement manufacturer in my constituency. Chemring Countermeasures has announced that there is to be a new 18.5 million investment in two new flare decoy manufacturing facilities. Every time any of us travel on a military helicopter, particularly if it is in theatre, we are used to the noise of the flares going off and of the chaff going out behind the helicopter, or any other kind of aeroplane. They have to be made somewhere. They happen to be made at High Post outside Salisbury.
	That company has an ancient and interesting history. The sadness is that there will be a loss of jobs over the next year or two because higher safety requirements mean that fewer people and more machinery have to be used. It is safer, better and even more reliable, but the downside concerns the people. I am glad to say that the company is working hard to ensure that the skills of those people can continue to be usefully deployedlocally, I hope. There is great family loyalty in the defence industry. In that factory I know, because I have met them, that three generations of several families are still working there.
	The story of Chemring Countermeasures goes back a very long time and is typical of defence procurement companies all over the country. It started back in 1941 with Chemring developing processes for metallising fabrics, which sounds an unlikely link, but it went back longer than that. In 1933 the Wessex Aircraft Engineering Company was set up. It was taken over by Bryant and May. Eventually that became Schermuly, which in turn became the British Match Corporation, incorporated with Wilkinson Sword. It is an extraordinary story of the interlinking of defence industries within the manufacturing base of our country.
	Eventually the business all came together in 1997 as Chemring Ltd. On this important day for that company in my constituency, I pay tribute to the company and to the work force who have made it so important a part of the everyday life of our servicemen and women at the sharp end, not just on land, but in the air and at sea, because that remarkable company provides countermeasures and flares for all three services, and sells substantially to our NATO allies as well.
	I finish by making another point about defence spending in this country. Sometimes senior figures in the shadow Cabinet groan when they see me coming because they know that I will say we should double defence spending. I know that that wish is unlikely to come to fruition in current economic circumstances. We all have to be hard-nosed about that, but we should seriously consider why we have the lowest defence spending as a proportion of our gross national product since the 1930s.
	It would have an electrifying effect on the country's economy and much else for which this nation stands if we were to rebuild confidence in our nationhood, as well as in our defence industries and the armed forces, by increasing substantially the defence budget. This, I believe, would not be resisted by the electorate because of the paradox with which I started. We know that Her Majesty's forces have never been held in higher regard except during the second world war and the years immediately afterwards. Why can we not match that former regard, and remind people that their quality of life, standard of living and ability to buy white goods in the sheds on the edges of our towns and cities depend on the defence budget and the dedication of all three forces? We should start arguing from that point of view. Defence is very much in our national interest in respect of consumer spending, energy, water supply and climate change, because it changes all our economic and political perceptions. If we harness that fund of support for Her Majesty's forces, we will do the nation a service, andabove allsay to those forces, Well done and thank you.

Robert Walter: Like my right hon. Friend the Member for North-East Hampshire (Mr. Arbuthnot) and others, I was a little perplexed by Defence in the UK, the title of today's debate. I have a major military establishment in my constituency; I referred to it in my interventions, particularly on the hon. Member for Vale of Glamorgan (John Smith), whose constituency will get my defence college when it eventually moves. There is also a major defence contractor in my constituency.
	The Minister probably struck the right focus in explaining the title as a reference to a consideration of the relationship between the armed forces and the people of this country. As my hon. Friend the Member for Salisbury (Robert Key) has just said, according to the opinion polls, our electorates focus on the economy, health and education. In our debates, we therefore have a responsibility to rehearse the issues and emphasise the importance of the defence and security of this country. My remarks will focus particularly on our alliances, which are essential for the projection of our foreign policy. We should consider our alliance with the United States and the relationship between Europe and the United States; that may change and develop under the new US Administration. I particularly want to focus on the relationship between the EU and NATO.
	In a week or so, we will celebrate 60 years of NATO, and this month we also celebrate NATO's major expansion of 10 years ago, when the Czech Republic, Poland, Hungary and the Baltic states joined the organisation. It is important to reflect on that. I want to mention the European security and defence policy, or ESDP, because its most ardent supporters and fiercest critics possibly misunderstand it. It is not collective European defence, or dfense Europe as the French would call it, and it never could be.
	Sixty-one years ago, on 17 March 1948, the Brussels treaty was signed, laying the foundations for a European defence process. The treaty was modified in 1954 and the Western European Union came into being. The key provision of that modified Brussels treaty is its collective defence clause. In parallel, the North Atlantic Treaty Organisation, the other collective security organisation, was also coming into being; it was established on 4 April 1949. It, too, makes provision for a collective response to an attack on individual members. However, in contrast to the modified Brussels treaty, it involves our transatlantic partners.
	Over the past 60 years, the collective defence clause in article 5 of the NATO treaty has been invoked only oncefollowing the 11 September terrorist attacks in the United States and it can be argued with some justification that the fact that it was invoked only once was a result of the west's successful deterrence policy over the cold war period. The main focus of development in recent years, in Europe and in NATO, has been crisis management activities. As we approach the 60th anniversary of the alliance, the question we should ask ourselves is: Where is all this leading? Will NATO and the European Union, through its ESDP, be able to meet the challenges of the 21st century?
	After the end of the cold war, the organisation of security and defence in Europe started to evolve, with NATO and the EU both embarking on an enlargement process. Since the NATO alliance was created in 1949, its membership has grown through five rounds of enlargement from 12 founding members to today's 26 members, and NATO's door remains open to any European country in a position to subscribe to the commitments and obligations of membership and to contribute to security in the Euro-Atlantic area. In parallel, the European Community, subsequently the European Union, has grown from six founding member states in 1951 to today's 27 EU member states, following six rounds of enlargement, and is also open to other European countries willing and able to join.
	Let us look at the added value in the defence and security arena of NATO and the European Union's ESDP. What is the added value of NATO? Its strong, integrated chain of command gives it the ability to conduct difficult combat missions. This multinational military structure is unique in the world. Neither the United Nations nor the EU has anything on such a scale. In contrast, the trademark of the ESDP is the EU's ability to deploy a wide range of instruments for monitoring, policing, peacekeeping and rule-of-law missions, including relatively high-risk military operations such as the one in Chad, which concluded a couple of weeks ago, and the anti-piracy mission off the coast of Somalia. The EU can also apply economic, political and diplomatic pressure.
	Like many other members of the European Security and Defence Assemblyformerly the Assembly of the Western European UnionI have worked hard over the years to ensure that the ESDP has developed in such a way as to complement NATO rather than compete with it. That makes sense in practical as well as political terms given that 21 EU countries are also members of NATO, and their troops can be used for EU-led or NATO operations, depending on requirements. The WEU, which in the past played a major role in establishing Europe's defence capability, drew up the Petersberg tasks in 1992. They covered a wide spectrum of activities, including humanitarian rescue, peacekeeping and crisis management missions, and were incorporated into the common foreign and security policy under the 1997 treaty of Amsterdam. In parallel, at the 1996 NATO summit in Berlin, the idea of creating a European security and defence identity in NATO emerged. A key development since then has been the Berlin-plus arrangements, which gave first the WEU and later the EU the possibility of drawing on NATO assets for military missions sponsored by them.
	All this is good, and much progress has been made, but perhaps the time has come for our Governments to agree to go a little further than the Berlin-plus arrangements and overcome the current political obstacles that are preventing NATO-ESDP co-operation from moving on to the next phase, which is so crucial if we are to meet all our global obligations and enhance the security of our peoples. The announcement by President Sarkozy of full French reintegration into NATO is an important step. It should also be taken as a sign that France recognises that defence in Europe is not a choice between the EU and NATO but complementary. As I said, the ESDP is not dfense Europe or collective European defence. Nothing in the EU meets the provisions of article 5not even the Lisbon treaty, if it is finally ratified. It does not, and cannot, provide the kind of collective defence commitment that membership of NATO implies.
	Collective territorial and strategic defence in Europe could and should be the role of the 21 EU-NATO members and their three non-EU neighbours, Norway, Turkey and Iceland. A strong commitment by the European NATO members is wanted and needed by the alliancea commitment not just to deployment but to spending and capacity buildingand that would be welcomed by the United States. EU-NATO relations need reviewing, and such a review would be useful on the strategic and institutional level as well as on the operational one. Both organisations run operations in a number of places: in Kosovo in the western Balkans, in Afghanistan and in Africa. But can we honestly say that they are deployed together? Is it not the case that they are being deployed alongside each other? Perhaps I might give a few examples that illustrate why the relationship between the EU and NATO is far from perfect.
	An EU naval force is currently involved in the anti-piracy Operation Atalanta, off the coast of Somalia Together with a number of colleagues, I recently visited the headquarters of that naval anti-piracy operation at Northwood. Securing our trade routes is important to all of us; 90 per cent. of global trade is carried out with merchant ships. The sea off the coast of Somalia has been the scene of an alarming number of pirate attacks recently, with the result that some merchant lines have changed their routes. Those attacks have reduced considerably since the launch of the Atalanta mission, which obviously has a deterrent effect on potential pirates.
	Operation Atalanta is run by the EU in the framework of the ESDP. The 10 or so participating nations are all members of NATO. Norway, another NATO member, has just announced that it will contribute a vessel to the operation, and others may join soon. Five nationsFrance, Germany, Greece, Spain and the United Kingdomare responsible for ensuring a permanent operational capability. However, these nations are not using NATO communications and intelligence systems. Instead, some ships have had to install a new, civilian system for satellite communications. I am told that when the navies of NATO member states go on joint exercises, they are normally quite happy to use the NATO communication system. We must look into why a special arrangement was necessary in this case. Why does Berlin-plus not extend to such operations?
	Another example is at the political level, in joint meetings of EU and NATO ambassadors. This example concerns the regular meetings that are held between the EU Political and Security Committee and the North Atlantic Council, which bring together the permanent ambassadors of both organisations' member states in Brussels. There was one such meeting on Monday of this week. The 21 EU member states that are also members of NATO are represented twiceby their NATO ambassador and by their PSC representative. Both are usually supported by different administrative structures and both may receive instructions from different hierarchical levels in their respective capitals. These parallel structures do not necessarily share a common culture. Moreover, the NATO ambassador is generally the more senior and higher-ranking of the two, which means that in practice only one of them speaks.
	These joint meetings are described by those attending them as sometimes rather sterile. They leave participants with a certain degree of frustration because of the particularities of the EU-NATO relationship, which is based on the so-called Berlin-plus agreements. The agreements consist of a number of unpublished documents that have never been subject to parliamentary scrutiny or ratification. The limits of Berlin-plus in practice confine EU-NATO dialogue to the Berlin-plus Operation Althea in Bosnia and Herzegovina and a joint EU-NATO working group on capabilities, and prevent NATO and the EU from jointly discussing pressing issues such as terrorism, Afghanistan or the middle east. The underlying problem is the unresolved dispute between Turkey and Cyprus. Turkey is a substantial contributor to ESDP missions and has vital interests in connection with its ongoing candidacy for EU accession. However, as soon as the suggestion arises of discussing issues that are not part of the limited agenda of the current military co-operation between the EU and NATO under Berlin-plus, Cyprus is not allowed around the table because it is not part of the partnership for peace programme and does not have security clearance for access to NATO classified documents. Conversely, the EU refuses to deal with anything other than Berlin-plus matters unless all 27 member states are present.

Robert Key: Will my hon. Friend share his perspective on the problem that Macedonia's name holds for the Greeks, who hold the right to block any progress for that new democracy because of the disputed name?

Robert Walter: I thank my hon. Friend for that intervention and share his frustration about the Greek veto over Macedonia's participation in NATO. If we can, we ought to knock some heads together. I remember being in Skopje not long ago with a former Greek Defence Minister, who as we walked into the meeting said that he could not give a stuff what they called their country, but as soon as we were in the meeting steadfastly defended the Greek line on the name. We have to move on, because such ridiculous problemsalthough the Turkey-Cyprus problem is not ridiculous to a Cypriotare blocking the co-operation that is essential if we are to move forward. I understand where the political rationale for Turkey vis--vis the EU lies, but we all need to look at the bigger picture.
	The bigger picture is where my third and last illustration of the current difficulties in EU-NATO relations comes from. It is Afghanistan, where the EU is not a very big player. However, there is a police mission run within the ESDP framework, and both the European Commission and EU member states spend large amounts of money in that country. EUPOL Afghanistan, the EU police mission, is suffering from the difficulties that participating EU member states have in finding police officers who are willing to work in such a challenging environment. The security of the police is obviously crucial to the success of the operation. However, due to the difficulties that I have just mentioned, the EU is not able to obtain a global security arrangement with NATO in Afghanistan, so it was necessary to negotiate individual security provisions with every provincial reconstruction team on the ground. What is more, intelligence sharing is made more complicated by the absence of a relevant EU-NATO agreement.
	Those examples show clearly that we need to find a way to improve the relationship between the two organisations. Beyond those examples, which could be regarded as anecdotes, there are deeper reasons for the current difficulties. First, I believe that, for a long time, the United States Government and many in this country have looked at the EU and the development of ESDP with a certain degree of suspicion. There has been a fear of duplication and the feeling that emancipation could lead to separation. None of that is true. ESDP is a process of consolidating, improving and extending member states' capabilities. It has created a new potential actor, ready to stand in when NATO cannot or does not want to get involved. Now is the time to draw the two actors and their member states closer together.
	There is, of course, an opposite view. Some believe that closer relations between the EU and NATO would result in too much influence for the USA. I hope that if such fears have ever been justified, they are less urgent with the election of the new President. The announcement made by President Sarkozy that he will take France back into NATO's integrated military structure is a clear signal of new thinking on that issue. There is a new window of opportunity. The new Administration in Washington are interested in good relations with Europeans and recognise the added value of effective multilateral institutions. That should not only help to improve relations between the EU and NATO, but provide us with a vision to help shape the role of both organisations in our security in the 21st century.
	I shall take as an example the situation of countries to the east of the EU and NATO border. NATO enlargement might not always be the best answer to their concerns and ours, but if it is not the right thing for those countries, what else can we propose, and what can the EU in particular offer them? Could the nascent EU eastern partnership initiative be developed into a transatlantic one?
	It is probably too early for President Obama and his new team to come up with any far-reaching proposals in early April at the NATO anniversary summit or at the EU-US summit the following day. But the different tone and style of the new American President could lay the basis of a positive review. One year from now, there could be a real breakthrough. We need the EU-NATO relationship to be clarified sooner rather than later, not least because we need our own minds made up before we face others who challenge the existing security architecture. I refer to the Russian President, Mr. Medvedev, his recent remarks about the weakness of the European security system and his proposal for a new European security treaty. In that regard at least, we know what we do not wantthe unravelling of the Helsinki principles.
	I conclude with two thoughts. First, we need to review not only the EU-NATO relationship but the EU-US relationship, and focus those relations more on security issues. We in Europe need to ask ourselves: do we want to be an attractive partner to the United States both inside and outside NATO? Do we want to contribute to the resolution of the huge challenges ahead of us? The Spanish Government, who take over the EU presidency in 2010, are considering the issue with a view to relaunching an EU-US initiative. In Madrid, in 1995, they launched a new transatlantic agenda, and this would be a new, new transatlantic agenda.
	Given the limited capabilities and our scarce financial resources, which will not only not grow but come under immense pressure once the current financial crisis has had its full impact on our real economy, we need to be innovative and imaginative in finding ways of co-operation and co-ordination. We need to be able to make the best use of the capabilities of both organisations and their respective member states. The military and civil dimensions of security go hand in hand and, institutionally, our response to conflict and crisis needs to reflect that.
	Secondly, as I said at the start, electorates tend to put schools, hospitals and health care before spending on helicopters, guns and missiles. However, we need to realise that we live in dangerous times and a harsh world, and if we want to make a difference and guarantee the security of our citizens, such investment is inevitable. We must also explain to our people that military operations, such as the one in Afghanistan, are not about remote conflicts, but directly concern security at home.
	At the NATO summit in Strasbourg and Kehl on 3 and 4 April, I hope that work will be launched on a new strategic concept for the alliance. It is time to move on and adapt NATO's strategy to future challenges. It is important to ensure a real democratic debate on transatlantic and European security challenges, and to promote bold ideas to enable NATO and the EU to meet those challenges.

James Gray: It is a pleasure to follow my hon. Friend the Member for North Dorset (Mr. Walter), whose expertise on matters European is second to none. I had the pleasure of serving alongside him, sadly only for a year, on both the Western European Union and the Council of Europe. Through my own ignorance, I never quite discovered what either organisation was for, what their purpose was, or whether they have oneto this day, no one has explained what it is. None the less, I am sure that they do fulfil an awfully useful purpose, and I congratulate him on the many hours that he spends seeking to discover it.
	My hon. Friend and I will not agree, I fear, on the importance of ESDP. My view is that the European Union is a first-class trading organisation among independent nation states, and the notion that it could have anything called ESDP is nonsensical. Why on earth the EU is busily engaging in a very good operation in Somalia defeats me. What on earth it is doing there I cannot imagine. Nor do I know why it is doing policing in Kabul. Those things can be done either by NATO or independent nation states, and I fear that I have a deep cynicism about whether European co-operation of the kind that my hon. Friend describes has much future. I readily say, however, that that is simply because of my bog-standard little Englander ignorance, and I am sure that I can be educated in such matters as time goes on.
	Secondly, I agree with my right hon. Friend the Member for North-East Hampshire (Mr. Arbuthnot), the Chairman of the Defence Committee, who is temporarily not in his place, about the structure of these debates. I am glad that today's debate has not been a topical debate, unlike, I believe, the last event of this kind. None the less, I feel that the present structure of our defence debates is rather false, and does not quite work. Those of us who are defence anoraks turn up on a Thursday afternoon, drone on for a quarter of an hour, and then go home. No one listens to a word we say, and the sum total of human happiness is not necessarily advanced. That should not be happening at a time when the nation and the globe are involved in such potentially catastrophic and vastly important defence matters. The entire House of Commons should be eagerly involved, and competing like mad to secure a five-minute slot. I hope the powers that bethe Government, the Leader of the House, or otherswill think about whether we could restructure our defence debates, at least while the current turmoil around the globe continues, and find a way of attracting greater interest in them.
	As always, however, this has been a successful, well-informed and wide-ranging debate. I shall not seek to add to what my many better-qualified colleagues have said about assorted defence matters. Instead, if the House will forgive me, I shall focus on a topic which may sound like a constituency issue more suited to an Adjournment debate, but which I would argue has a much wider significance for the defence of the realm than for my own constituency.
	We know that, in Afghanistan and elsewhere, one of the biggest failings one way or anotheralthough the exact way in which it has failed is debatablehas involved helicopters. There are those who would say that we have not got enough of them, there are those who would say that we have not got enough pilot hours, and there are those who would say that both are the case. There are others who would say that although we could always do with more, we have enough to manage with. That, broadly speaking, is the Government's line. I think everyone would agree, however, that the way in which our joint helicopter forceArmy, Navy and Air Force helicoptersare currently managed is not ideal. The helicopters are based in a variety of places around Britain, and there is very little coherence. Joint Helicopter Command, which I believe was created only a year or two ago, experiences some difficulty in acting as a coherent purple organisation.
	There has been a strong demand from Joint Helicopter Command, and from the three services, for a move towards the establishment of a single unified base for, in particular, RAF and Army helicopters. That strikes me as an immensely laudable and hugely sensible ambition with a great deal to be said for it, and I think that just about everyone in the defence world agrees that it should be realised. One senior officer involved with helicopters said to me the other day, referring to Project Belvederewhich is what we are talking aboutThey cannot afford to do it, but they also cannot afford not to do it. I think that there is a good deal of truth in that, and I shall return to it in a moment.
	There is a reason for my interest in Project Belvedere. The House will recall that some eight or nine years ago it was announced that the C130K fleet of Hercules aircraft based at RAF Lyneham, in my constituency, would reach the end of their useful life in 2012or would progressively approach the end of their useful life in the years leading up to 2012and that, at that stage, the C130J fleet of modern planes would be transferred to RAF Brize Norton, just down the road. All the RAF's transport capabilities for passengers, freight and tankers would be based there.
	Many of us argued strongly against that decision, which was advanced for two main reasons. First, it was claimed that combining the two bases would produce a cost saving. That may be the case, although a substantial capital cost will be involved in the move, and only accountants will be able to tell us how long it will take for the modest year-by-year saving to pay that off.
	I was talking to one of the base commandersI will not say who it waswho would be involved in Project Belvedere and in the transfer of his helicopters to RAF Lyneham if that were to happen. He maintained that the cost would be so large that it would take 50 years to repay it. I said, That is a very interesting argument. If that applies to your helicopters being moved from base Xwhich I will not nameto Lyneham, how much longer would it take to repay the vast amount that it will cost to move our Hercules fleet from Lyneham to Brize Norton? He said, Well, it is certainly 50 or 100 years, and it is possibly never. I said, I will not name you, but I will quote you, which I have happily done.
	The accountants are going to have to answer much more clearly on how they can add the thing together to make a sum that justifies shifting 3,500 RAF people and up to 50 planes from RAF Lyneham to RAF Brize Norton, which is already too small. Anyone who has had the misfortune to travel courtesy of crab air to Afghanistan or Iraq, which I have done two or three times recently, will know that RAF Brize Norton is already one of the least hospitable bases and that it is demonstrably too small for the job that it does at the moment. If about 50 Hercules, A400Msif they arriveor C-17s were also operating out of the base, goodness knows what it would be like.
	At the moment, three tactical runways, two of which are at RAF Lyneham and one of which is at Brize Norton, are used for transport. If we were to bring everything together in one place at Brize Norton, all our eggs would be in one basketthere would be only one runway, and there are many reasons why it might be inoperable. I was there the other day waiting to fly out to Afghanistan. I was delayed for 12 hours because of ice on the runway. If all our transport capabilityrefuelling, transport and passenger planeswere in Brize Norton, who knows what the end result would be? The first argument in favour of collocating everything at Brize Norton, namely cost, is questionable, and perhaps the accountants will have a second look.
	The second argument for collocation at Brize Norton advanced at the time was that the A400M was coming in by 2012, that it would be the greatest thing since sliced bread, that it was a European co-operative project and that it would be a superb aeroplane. We all know that the project has been delayedthe latest I have heard is that it will be delayed by up to four years, although no doubt the delay will be longer than that. The Secretary of State has made it plain in a couple of interventions from the Dispatch Box that he is by no means confident that the A400M will be bought by the British forces, at least to the extent that we said we would buy it.
	The whole future of transport is questionable. Most people in the RAF would prefer to see a fleet consisting of Hercules and C-17s, which is the ideal combination of sizes. From memory, we already have six C-17sperhaps the figure is eightand we can certainly buy or lease more. Hercules and C-17s seems like a nice combination to me. That combination operates nicely out of RAF Lyneham, and there is no reason why it would have to be based at Brize Norton. At the time, the argument was that the runways at RAF Lyneham are too short for the A400M to take off or land. That is demonstrably not the case, and that excuse was used to achieve other things.
	I would prefer to see RAF Lyneham remain the same as it is at the moment. I hope that the delays with the A400M and/or the delays in rebuilding RAF Brize Norton will lead to that outcome. I hope that that door is not entirely closed. Without being party political about it, if there is a Conservative Government at some stage in the futureof course, there might not beperhaps Conservative Front Benchers will consider reversing that decision. There may well be good economic reasons why it is impossible, but I hope that they do. In a recent informal conversation with one of my Front-Bench colleagues, I was encouraged to hear him say that Conservative policy is not to close RAF bases. We have to keep RAF bases openin 1942, we discovered that we did not have enough. That was an informal remark, and I may be corrected by other Front Benchers, but I will seek to persuade them to keep RAF Lyneham as it is.
	Let us assume that for good reasons advanced by accountants or others, it is not possible to keep RAF Lyneham as it is. At the moment, 3,500 service personnel and 750 civilians work on the base. If one brings those people's other halves into the calculation, some 10,000 people in my constituency owe their livelihood one way or another to RAF Lyneham, and there are also retired service personnel. It is, therefore, a major part of my little constituency, and plays a very significant part in its economy, so the future of RAF Lyneham is of gigantic importance to me as a constituency MP.
	I hope and think that I speak for the vast bulk of my constituents in saying that we would very much like Lyneham to remain military. We do not think it is right to convert it to any other use. We do not want a new townan extension of Swindon, perhapsor a refuelling base for Virgin Atlantic; that is a proposal I have heard, but it would certainly not be appropriate. We do not want it to become a gigantic industrial site either. We would very much like it to remain military. Wiltshire is home to the military, and the military are home for us in a very real way. We are very proud of our contribution to the military; half of the British Army is in Wiltshire. We want Lyneham to remain militaryeither RAF or, potentially, Army.
	Therefore, if we can find a way of making Project Belvedere work and of bringing all the helicopters from all the different commands togetherleaving aside the Royal Navy, which will stay in Yeovilton, I thinkunder Joint Helicopter Command at RAF Lyneham, that would be an eminently sensible solution. That would involve 15,000 people and 230 helicopters, so there would be quite a significant environmental price to payalthough I am encouraged to hear my right hon. Friend the Member for North-East Hampshire telling me that in all his time he has only had one or two complaints about noise from Chinooks. Nevertheless, I am aware that if we were to have 230 helicopters operating from RAF Lyneham and 15,000 people, compared with the 3,500 we have at present, there would be a price to pay in terms of developing the air base. My soundings so farI cannot claim to speak for everyone by any stretch of the imaginationare that the vast bulk of the population would be ready to accept that environmental price under certain conditions, which I will return to in a moment, in return for the continuing economic viability of the area. We want the jobs and the military there, and therefore putting up with helicopter noise, which is a little bit noisier than Hercules noise, is something that I think the vast bulk of my constituentsalthough not all of them by any stretchwould be ready to accept.
	In that context, I say to the Minister that if Project Belvedere goes ahead, it would be nice to enter into a period of negotiation with the RAF and the Army about flying protocols, so that we could minimise the disruption to the surrounding areas. I have already had brief discussions with the Army, who tell me that the majority of flights would be in a narrow corridor going from Lyneham down towards Salisbury plain, and we could enter into negotiations to minimise disruption and noise for local people.
	The main problem is not knowing. In recent weeks, I have had a number of discussions about this matter with the Minister, as has my right hon. Friend the Member for North-East Hampshire, and rumours have flown to and froBelvedere is on. Belvedere is off. Who knows what's happening? We haven't got the money, but we need to do this, and so on. It is important that a decision is made soon. Rumours coming back from various people in the MOD suggest that there is a plethora of committees and commands, and reports going to and fro and minutes of meetings, and that no one can make up their mind what to do. It is important now that the MOD decides either to go ahead with Project Belvedere or a lesser form of it, oralthough I am very opposed to thisnot to go ahead with it at all.
	If the MOD comes to that final conclusion, the last thing I would say on this subjectI am sorry to have bored the House by focusing on what is largely a constituency matteris as follows. I have seen what happened to RAF Wroughton, which my own Conservative Government made the foolish decision to close in 1995 or so. It lay empty for many years, and there was vandalism and dereliction and total waste. I have seen the same in the town of Corsham in my constituency. The Army moved out in the '50s or '60s, and the town went down for a long time, although it is now coming back up again because of investment through the Defence Information Infrastructure process at Rudloe Manor.
	The one thing I would not want to see at Lyneham is indecision and its lying vacant. We must not pull out the Hercules and then have nothing happening there at all. We must have clarity in terms of what is happening. The military might want it for some purposeperhaps a garrison returning from Germany. Alternatively, if the military come to the clear conclusion that they do not need it and that they will leave in 2014 and hand it over to the local authorities and others who will make something out of it, I would welcome that, too. It is important that we now start to get a little bit of clarity about what the future holds.
	I repeat my main point: I hope very much that we can keep the Hercules fleet at Lyneham. If we do not, I hope that we can get Project Belvedere and get the helicopters there. If we do not, I hope that we will find some other military use for Lyneham. If none of those three options works, all I would say is, for heaven's sake let us have a clear decision and let us get on with the next stage in our life.

Julian Lewis: One is sadly accustomed in these debates to paying tribute to service personnel who have been killed in theatre, previously in Iraq and currently in Afghanistan. One did not expect to have to refer to the murder, for that is what it was, of two young soldiers in Northern Ireland on the eve of their bravely flying out into theatre in Afghanistan, where they would have faced danger from a more recognisable enemy. I would like to raise, in a gentle way, for Ministers' consideration, one small issue that has not been raised today. They may not be aware of a petition that has drawn attention to the fact that these two young soldiers have not been accorded the same sort of ceremonial honour in being returned to the mainland of the UK that they would have been accorded had they died on active service in Afghanistan. These young men did die on active service, just as much as if they had been killed in Afghanistan, and it is only right and proper that they should be accorded the same sort of ceremonial honours. I hope that something can be done in that respect, particularly as it appears that one of their last acts was selflessly to try to protect their comrades as they came under fire.
	In this debate, one Minister and three Government Back Benchers have spoken, one Conservative shadow Secretary of State and seven Conservative Back Benchers have spoken, and one Liberal defence spokesman has spoken. No Liberal Back Benchers have made a speech, despite the heroic efforts at in-flight refuelling by two Back Benchers making short interventions. In a debate on a subject of such breadth and importance, it behoves both the Government and those other parties that purport to be part of the Opposition to make sure that they are here in strength to speak up for their various views of the interests of the armed forces.
	I come to the contributions that were made. The hon. Member for Vale of Glamorgan (John Smith) examined in customary depth and detail the defence training project scheduled for his locality. It appears to have been a timely speech, given the likely contents of a reportstill embargoed, but due out tomorrowthat might have taken the edge off it. The hon. Member for Stafford (Mr. Kidney) spoke warmly of the support for the armed forces, and especially for the Gurkhas, shown by his constituents. My hon. Friend the Member for North Dorset (Mr. Walter) made a very persuasive speech. If anyone could persuade me that the European security and defence policy could complement, rather than undermine, NATO it is hebut even he has some way to go before he manages to achieve that.
	My hon. Friend the Member for North Wiltshire (Mr. Gray), who has just spoken, was, as usual, passionate in his campaign against the proposed amalgamation of RAF Lyneham and RAF Brize Norton, but he was also deeply realistic, saying to MinistersI saw assent being indicated from those on the Treasury Bench on this matterthat if there is to be some sort of adverse decision, it is better that it should at least be made clear as soon as possible.
	My hon. Friend the Member for Salisbury (Robert Key) stressed in encouraging detail the very high public support for the services and for service charities. He pointed out that we still have major global interests and therefore need global reach, and that of course relates to both the amphibious capabilities and the future aircraft carriers. It must be said that he has a special interestperhaps he ought to have declared a family interestin the aircraft carriers, given the excellent news that his nephew has been recently appointed to command HMS Illustrious. He also made a very interesting point about the size of the defence budget and what we would like it to be. He has the freedom to make that point, but I do not, although I shall be returning to that area a little later.
	My hon. Friend the Member for Congleton (Ann Winterton) asked about how state-on-state war would be paid for. The answer is that if it ever happenedGod forbid that it shouldit would not be paid for in any planned sort of way. We do not go out and about looking for state-on-state warfare: we tend to get involved in such warfare when we are attacked by large, hostile states. What we have to do then, frankly, is find the resources irrespective of whether we can afford them. What we have to do in times of peace is at least retain the nucleus for expansion across the spectrum of armed forces capabilities, so that if we ever do have to fight for our very lives in or around our homeland, we would at least have the potential for expansion, which we would not have if we closed things down, bulldozed the sites and said that we would never do anything other than counter-insurgency in the future.
	I was greatly encouraged to hear from my right hon. Friend the Member for North-East Hampshire (Mr. Arbuthnot), the Chairman of the Defence Committee, that his Committee has decided that we are not under imminent threat of invasion from Russia. Indeed, I would have hoped that his Committee took the same view even throughout the cold war. One of the reasons why we were never under threat of imminent invasion was that we were sensible enough to keep our defences strong, not least by retaining a nuclear deterrent that made it clear to any other power that no matter how many times over they could obliterate this country, they would not be able to do it without paying an unacceptable price.
	My right hon. Friend gave an appropriate and sombre warning about Afghanistan, but that does take us somewhat outside the scope of this debate. I agree that questions could be asked about the parameters of these debates. I have tended to look at this one not as Defence in the UK, but Defence of the UK, as it complements the subject of defence in the rest of the world. That is a commonsense way to look at it.
	We heard a typically magisterial speech from my right hon. and learned Friend the Member for Kensington and Chelsea (Sir Malcolm Rifkind). He sets an example to the House of what it means to have experience, intelligence and fine judgment. His observations on the use of the reserves as a substitutenot from time to time or to fill particular gaps, but as a cheap alternative to adequate regular forceswere very well made indeed. The consequences of what he talked aboutthe under-resourcing of defence as a wholeare clear for all to see. One has only to look at the reports of the breakdown of relationships between the service chiefs, when they spend time rubbishing the projects of the other armed services in order to try to get a better share of an inadequate cake, to realise the poisonous effect of what has been done to the harmony, efficiency and potential of the armed forces.
	I shall repeat what I have said every time that I have had the privilege of making a speech in one of these defence debates. We cannot go on as we are. We were spending 2.5 per cent. on defence when we went into Afghanistan and, as Tony Blair said in his valedictory speech on HMS Albion, we are still spending 2.5 per cent. on defence if the extra cost of Iraq and Afghanistan is added. We have, therefore, been engaging in two medium-scale conflicts on effectively a peacetime defence budget.
	I do not know yet what final determination will be made by the leader of my party and the shadow Cabinet on pledges before the next election. One thing that I have been allowed to say repeatedly, however, and I say it againthere is nothing so good in counter-propaganda as repetitionis that a future Conservative Government will fully fund the defence commitments that we undertake. That is not happening at the moment, and it must mean that there will have to be either greater funding in the future or fewer commitments. Which of those two it will be, or whether it will be some point in between, will be revealed nearer the time. However, there will not be a continuation of fighting wars in a way that undermines the future viability of the core armed forces.

James Arbuthnot: Does my hon. Friend remember that, before the 1997 general election, the Labour party pledged that we would reduce the proportion of spending on the defence budget to the European average of gross domestic product? Luckily, when European countries started to reduce their defence budgets as dramatically as they did, even this Government decided that they could not keep up with them in the downward spiral.

Julian Lewis: I do indeed. I also remember during the cold war yearslike many middle-aged men who were involved in those arguments at the time, I am prone to looking back to that time too oftenthe argument was always to ask why Britain was spending a greater proportion on defence than most of our NATO partners when our European colleagues and partners in NATO were spending much less. In fact, we were spending more than just about all of them except for the Americans. As somebody once pointed out, that was the wrong comparison. Those other countries were on our side. We should have been looking at what was being spent by our potential adversaries rather than what was being spent by our allies. We have to spend as much as the country can afford to fulfil as many military commitments as we need to undertake. We must not be guided by what other countries do, especially if they are on our side rather than our potential adversaries.
	I now come to the question of the nuclear deterrent. It was pleasant to hear the traditional voice of Labour unilateralism coming in an intervention from the hon. Member for Liverpool, Walton (Mr. Kilfoyle), who spoke of the letter in  The Times from three retired generals, and from the hon. Member for North Ayrshire and Arran (Ms Clark), who was concerned that other countries would follow the UK's example if we do not get rid of our nuclear weapons, presumably by acquiring nuclear weapons of their own, and claimed that such projects are historically far more expensive than when planned.
	I have to correct the hon. Lady on both points. Both Trident and Polaris are famous, if not unique in MOD terms, for having come in on time and on budget and, in at least one case, under budget. As for other countries, they will not make a decision to acquire nuclear weapons because Britain, an existing nuclear power, continues to maintain a minimum nuclear deterrent as long as other countries still have nuclear weapons themselves. Whether countries acquire nuclear weapons or not is a matter of their hard-headed interpretations of their own strategic interests. Throughout the cold war and subsequently, whenever people on that side of the argument were challenged to name a particular nuclear or near-nuclear country that would follow suit if we unilaterally gave up our nuclear deterrent, they have never been able to give an example.
	As for the letter from the three generals, I would like to think of one of the three, Sir Hugh Beach, as a friend of mine. He is a very gallant and courteous man, who won a military cross fighting the Nazis in world war two. I think very highly of him, but he has always been against Britain's having an independent nuclear deterrent. I was pleased that, when the Royal United Services Institute invited him to write a long article for its journal, I was encouraged to write the rejoinder for the opposite side of the case. I invite anoraks on this subject to get hold of the February 2009 edition and immerse themselves in those two articles.
	As well as being one of the most decent Members of this House, my hon. Friend the Member for Canterbury (Mr. Brazier) is certainly one of the most respected on the subject of reserves, but I want to concentrate on another aspect of his excellent speech. He went to the heart of the matter when he pointed out that virtually all the wars and conflicts in which we have been engaged in recent history took us completely by surprise. He gave a long and extremely impressive list, but I should like to add one more example. In the 1920s, this country's armed forces were so unclear about where the next war was likely to come from that each of them prepared its own hypothetical contingency plans against entirely different potential enemiesthe Royal Navy against Japan, the Army against Russia, and the Royal Air Force against France. At least one of them got it right, but I leave it to hon. Members to decide which.
	I turn now to the contribution made by the Minister for the Armed Forces. I was surprised at his feeble attempt to suggest that the Conservative policy on the maintenance of Trident was unclear. The Conservative party is the only major party in this House that has supported the maintenance of the strategic nuclear deterrent ever since Britain acquired one.
	I take the Minister back to that happy day of 14 March 2007, when this House voted by 409 votes to 161 to proceed with the steps necessary to renew Trident and keep the nuclear deterrent for a new generation. On that day, 87 Labour MPs joined the Liberal Democrats in opposing the motion. If the Conservative party had done what the Liberal Democrats did and found an excuse to vote against the Government, the Government would have been defeated. So it really ill behoves the Government to say that the Conservative party, which saved their correct policy to go on with the nuclear deterrent, is in any way uncertain about the matter. If the Minister had any doubts in that regard before today, the excellent speech from my hon. Friend the Member for Woodspring (Dr. Fox), the shadow Secretary of State, means that he can have no more in the future.

Bob Ainsworth: All I was seeking was clarification.

Liam Fox: Well, you got it!

Bob Ainsworth: Absolutely, we certainly have it now, but it is something that the shadow Chancellor will have to bear in mind when he draws up his plans. As I said, the Conservative party must somehow stretch its ambitions around the money that it is applying, and the two do not match.

Julian Lewis: Here is a litmus test for the Minister: when he sees that my hon. Friends the Members for Woodspring and for Aldershot (Mr. Howarth)and, I venture to say, myselfhave been quietly shifted away from the defence portfolio to other responsibilities, he may have some grounds for suggesting that there is something in what he has said. One never knows, as all such matters are in the lap of the godsor, in this case, my right hon. Friend the Member for Witney (Mr. Cameron), the leader of my party, whom we all greatly admire and respect.
	I particularly admire and respect my right hon. Friend because I remember his excellent response to Tony Blair at the end of 2006, when the statement about the Government's intention to go on with a new generation of the nuclear deterrent was made. I was somewhat involved in the drafting of that reply and my right hon. Friend made only two alterations, both of which made it even tougher than it had been in the original draft. I therefore have no doubts whatsoever on that matter.
	I turn now to the contribution from the Liberal Democrat spokesman, the hon. Member for North Devon (Nick Harvey). I think that I dealt at the time with his bizarre claim that his party had been vindicated by the fact that a timetable had been set for withdrawal from Iraq, now that the insurgency has been brought so massively under control. The Liberal Democrats were advocating a timetable for withdrawal while the outcome of the conflict was still in doubt. I have argued before that counter-insurgency involves four elements: identification of the enemy, isolation of the enemy, neutralisation of the enemy and negotiation with realistic parts of the enemy to deal with the irreconcilables so that peace can then prevail. That is precisely what has happened in this case.
	The hon. Gentleman's remarks about the protesters were well made and his commitment to a strategic defence review is good. It is a pity that it came so long after my party's calls for one, not only now but every four years. One of the interventions made during his speech seemed to suggest that we needed a strategic defence review because the last one had been tailored to the cold war. That is the opposite of the truth: the last strategic defence review, which we all, on both sides of the House, said at the time was a pretty good piece of work, was precisely tailored to the post-cold war world.

Nick Harvey: Yes.

Julian Lewis: I am glad the hon. Gentleman sees that. Perhaps that was why he described the intervention as interesting rather than giving it more positive support.
	My time is all but up but I should like to say a word or two[Hon. Members: It is up.] Okay. I shall say a word and a half about the carrier project. In a written statement on 11 December, the Secretary of State said:
	We have concluded that there is scope for bringing more closely into line the introduction of the joint combat aircraft and the aircraft carrier. This is likely to mean delaying the in service date of the new carriers by one to two years.[ Official Report, 11 December 2008; Vol. 485, c. 67WS.]
	However, although Lockheed confirmed that it was ready to deliver the first aircraft by 2014, the company was told by the MOD that it would not need the aircraft until 2017. The Minister with responsibility for defence equipment stated on 23 February that
	the reprofiling of the carrier programme was in no sense due to any delays in the JSF programme.[ Official Report, 23 February 2009; Vol. 488, c. 10.]
	I have been referred by the Prime Minister in written answers to questions that were not reached on a Wednesday, both yesterday and last month, to each of those answers, so I should be very grateful indeed if the Minister would give us the reason why the aircraft carrier programme was delayed. It has not been made clear yet.

Kevan Jones: As usual, the debate has been wide ranging. The contributions were not only well informed but covered interesting subjects.
	Today, on the Conservative Front Bench we saw the neo-cons versus the Cameroons. The hon. Member for New Forest, East (Dr. Lewis) is a strong advocate for the nuclear deterrentI would recommend to anyone his pamphlet arguing the case for it. It would be interesting if there were a Conservative GovernmentI shall not say that I look forward to the dayand the hon. Member for Aldershot (Mr. Howarth) was at the Department for Environment, Food and Rural Affairs and the hon. Member for New Forest, East at the Department for Culture, Media and Sport, with the hon. Member for Woodspring (Dr. Fox) running some bit of Government equivalent to a Siberian power station.
	Today, the Conservatives have set out clearly that the nuclear deterrent is not up for negotiation. The reason that clarity is important is that sad anoraks, such as me, who read conservativehome can see that the central hierarchy of the party are trying to test the waterto find out whether negotiation would be possible. The clarity we have heard today is very important.
	The hon. Member for Woodspring made an interesting speech and, in his usual way, covered a large number of subjects. He seems to think that the Navy is separate from the rest of the defence budget. He talked about the Navy being betrayed. I want to reinforce the point made by my right hon. Friend the Minister for the Armed Forces. We have the largest building programme ever for the Royal Navy14 billion over the next 10 years. That is a clear commitment from the Government to the Navy. It is important to ensure not only that we equip the Navy with the ships it requires but that we have the skills to produce those ships in UK yards.
	Resources were mentioned. I look forward to hearing debates on the issue as the election gets closer. The hon. Member for Aldershot is clear about his position; he said on Newsnight on 6 September 2007 that it was absolutely crystal clear that if his party came into office on the next day, they would spend more money on defence. Clearly, that line has now changed. I think that when it comes to the defence budget, we will see more confusion of the sort that we saw on tax policy this week in the Conservative party.

Liam Fox: rose

Kevan Jones: I will not give way; I do not have time.
	I think that the three hon. Gentlemen on the Conservative Front Bench argue their point of view quite sincerely, because all three are strong advocates of the armed forces and supporters of the defence sector, but they will come up against a lot of Cameroons and others in their party who will not want to commit to defence.
	The hon. Member for Woodspring mentioned Russia; I know that he raised the issue on another occasion, too. He asked whether there had been increased submarine activity. There has not been any increase in the usual levels of activity. There has been an increase in surface activity, but I think he will appreciate that I do not want to go into too much detail about that. Cyber-security needs to be taken seriously not only by the Ministry of Defence, but across Government. It is a new field that will increasingly play an important part in any type of attack in future.
	The hon. Member for Woodspring rightly referred to the increased body armour provided in armed vehicles. More armed forces men and women in Afghanistan and Iraq are now surviving attacks, not just because of the skill of our medical staff but because of the protection they get. That leaves issues to do with rehabilitation, and I am certainly committed to ensuring that those concerned get support.

John Baron: Will the Minister give way?

Kevan Jones: I will not.
	The hon. Member for Woodspring touched on the subject of mental health, which was also mentioned by the hon. Member for North Devon (Nick Harvey). The hon. Member for Woodspring asked whether the issue was at the centre of the Ministry of Defence's concerns. I am determined to make it so, not just for the ministerial team, but within the chain of command, because all the evidence is there. We have to be careful not to use intemperate language when talking about the numbers. The numbers are quite small, but that does not detract from the fact that if just one single person suffers from post traumatic stress disorder, it is a personal tragedy for that individual and their family. We must do our utmost to protect them. I am working with service charities and other sectors on the welfare pathway, which will be announced later this year. It will look at the support that we give to our men and women not only when in service, but once they leave service.

John Baron: Will the Minister give way?

Kevan Jones: I am sorry, but I will not.
	The hon. Member for Woodspring raised the issue of decompression. Every time I have been to theatre, I have asked about the issue. I was in Afghanistan a few weeks ago and asked again whether the decompression period was long enough. It is 48 hours in Cyprus. Every single time, both commanders and normal soldiers tell me that that is long enough. I have said this to the hon. Gentleman before: I ask him not to denigrate in any way the role of our civil servants serving overseas. I do not think that he did so intentionally. Those staff are volunteers, and many are doing dangerous jobs in dangerous situations. We should thank them for the role they play.
	I do not know whether anyone here has seen the film Groundhog Day, but the contribution of my hon. Friend the Member for Vale of Glamorgan (John Smith) perhaps reminded a lot of us of it. He is a great, strong advocate for St. Athan. A lot of Members have asked where the new facility is, and I had to think very hard about whether it actually was in his constituency. I pay tribute, as he did, to the brigadier and the project team who are delivering that facility. It is a challenging and complex project that will not only deliver the training we need, but, as he rightly highlighted, have an economic impact on his constituency and part of Wales; that should not be underestimated.
	The hon. Member for North Devon spoke of the number of people who have, sadly, been wounded or died in Afghanistan. May I join him in paying tribute not just to the men and women who have lost their lives, but their families, and to the medical staff, to whom he drew attention? I will not repeat the arguments on the timetable for withdrawalit is one occasion on which I agree with the point made by the hon. Member for New Forest, East.
	As for the larger issue of where we are, we are making changes, and there is new thinking on how we deal with, for example, the arms plot to provide more settled lives. The regional forces review will address some of the issues that, particularly in the Army, have not been previously addressed. I am not a great supporter of a defence review, because I fear that it would take a lot of time and effort, and detract from the immediate task at hand, which is not just supporting our service men and women but looking at their operational commitments.
	Turning to the contribution from the right hon. and learned Member for Kensington and Chelsea (Sir Malcolm Rifkind), may I say that, yes, it is a great honour to be a Minister in the Ministry of Defence. Anyone who has that privilege, as he did, knows that we deal with some remarkable men and women in a great Department. I was a little concerned, because I know that he is a former Foreign Secretary, that he used the words, wars of choice. I am worried that that may be interpreted as our being able to pick and choose the conflicts in which we become involved. I accept that he is not an isolationist who thinks that England can somehow divorce itself from the rest of world. Howeverand he knows this from his experience in the Foreign Office and the Ministry of Defenceone of those Departments may not think about the implications for others of its decisions. Having been on both sides, seeing that must have been difficult for him.
	I do not agree with the right hon. and learned Gentleman's perception of why and how reservists are used. The position has changed. I never cease to be impressed when I go to theatre by the dedication of the men and women I meet. In some cases, certainly in reconstruction projects both in Afghanistan and Iraq, their civilian skills serve a useful purpose.
	The right hon. Member for North-East Hampshire (Mr. Arbuthnot) raised the issue of Belvedere. May I tell him and the hon. Member for North Wiltshire (Mr. Gray) that my right hon. Friend the Secretary of State has got the message? We need to move on this, and my right hon. Friend agrees that the delay and uncertainty are not helping. The right hon. Member for North-East Hampshire raised the issue of JPAthe organisation that procured it is based in his constituency. May I sayand I have said this beforethat it is a standing issue when I meet the head of defence personnel? There have been problems, but it is a remarkably successful IT project compared with those in other Government Departments. The important point about JPA, which I want to push, is how we achieve increased access to it. Internet access is the way forward. There are some security issues, but we are addressing them.
	My hon. Friend the Member for North Ayrshire and Arran (Ms Clark) raised the issue of nuclear deterrence. As the hon. Member for New Forest, East said, it is nice to see that the unilateralist flame still burns in our partyalthough that is not something that I ever supported, I hasten to add. My hon. Friend mentioned the DSDA, and I will take that message back to the Under-Secretary of State for Defence, my hon. Friend the Member for Grantham and Stamford (Mr. Davies).
	I have a lot of time and affection for the hon. Member for Congleton (Ann Winterton), but I thought she was occasionally a little intemperate in her speech. She takes a close interest in protected vehicles, and in a previous debate expressed thanks and recognised the advances that had been made. She asked for numbers, but I do not want to give the number of individual vehicles for operational reasons. Great advances have been made. When I was in Afghanistan a few weeks ago, I saw not only how they saved people's lives but the adaptations that had been made in theatre. We can rightly be proud of that.
	The hon. Lady spoke about Merlin. The reason for the upgrade is that it is not a simple matter to move an aircraft from a peacetime role in the UK to an operational role. The issue was not that the helicopters could not fly without their rotor blades, but the need to increase efficiency. As a result, the number of flying hours that we are getting out of helicopters in Afghanistan has substantially increased.
	My hon. Friend the Member for Stafford (Mr. Kidney) paid tribute to 22 Signals and thanked the people of Stafford for their support for the armed forces, particularly for the Gurkhas. The Gurkhas are within my area of responsibility, so I know that they will warmly welcome the support they are getting locally.
	On the Borona project, I was in Germany on Tuesday and was briefed about the process. There is work to be done on sites and time scales, but I assure my hon. Friend that the project is still on schedule and under active consideration. It is important that where we site super-garrisons we have good working relationships in advance with local authorities, and I am sure he will play his role in that.
	The hon. Member for Canterbury (Mr. Brazier) made a passionate and well-argued speech. He is a great advocate for the reserve forces. I, too, congratulate the Argylls in his constituency. We should not forget the reservists who have been wounded or killed in action, especially members of the special forces. We should ensure that they get recognition. I am sure that when the review document is published, the hon. Gentleman will be pleasantly surprised by much of it.
	The hon. Member for Salisbury (Robert Key) is my former colleague on the Defence Committee. I think I have been to Salisbury more times in the past few months than I had ever been in my life, and it is a wonderful city. He spoke about the role of the Navy and he is right. When I go to Kandahar or Camp Bastion, there seem to be more submariners there than anywhere else. They are playing a key role. I thank the hon. Gentleman for raising the issue of Help for Heroes, which has raised not only money but the profile and support for our troops, which is welcome.
	One of the privileges of my job is to work with armed forces charities, which do a fantastic job. I am not one who thinks that Government can do everything. The charities have an important role. I hope that many people take part in armed forces day on 27 June and give the recognition and support that our troops deserve.
	We heard a fascinating contribution from the hon. Member for North Dorset (Mr. Walter), which showed the tensions in the Conservative party on Europe. I am glad that he and the right hon. and learned Member for Rushcliffe (Mr. Clarke) are now in the ascendancy again in the party. The hon. Gentleman's speech was well argued. Britain cannot do anything alone. Working with European partners and NATO is important. We need to explain that and fight back against little Englanders such as the hon. Member for North Wiltshire. I wish the hon. Member for North Dorset well in his campaign to educate the more recalcitrant members of the Conservative party about the benefits of the European Community.
	I have already mentioned Project Belvedere, which was also raised by the hon. Member for North Wiltshire. I understand the frustration. The hon. Gentleman makes a good point: a decision needs to be taken so that we can move on and get the necessary involvement.
	In closing, it is always important for us to say a big thank you to our men and women in the armed forces. Whenever I meet them, whether in this country or abroad, I realise that they are young men and women carrying huge burdens of responsibility. In my first contribution to one of these debates, I said that I would like to continue the bipartisan approach in the House, which we certainly had in the Defence Committee, so that we are united in thanking and supporting the members of our armed forces who are doing very difficult jobs on our behalf.
	 Question put and agreed to.
	 Resolved,
	That this House has considered the matter of defence in the UK.

PUBLIC HOUSES

Motion made, and Question proposed, That this House do now adjourn. (Helen Goodman.)

Laurence Robertson: I thank Mr. Speaker for awarding me this debate and the Minister for staying behind to reply to it. I say affectionately to the Minister that the pub industry and certain products in which it deals are close to his heart, as they are to mine. We share a number of interests, including horse racing and the odd social half hour in the bar downstairs. I am delighted that this Minister is replying to the debate. I am also grateful to the British Beer and Pub Association and the all-party beer group. My hon. Friend the Member for Ribble Valley (Mr. Evans), a member of the group, is here today to take part in the debate. I should also thank my local landlord, Mr. David Baker of the Village Inn in Twyning, for advice, facts and figures.
	Obviously, pubs are historic institutions and go back many centuries. The Royal Hop Pole in my constituency was mentioned by Charles Dickens in The Pickwick Papers. Pubs represent a big industry; there are more than 62,000 in Great Britain today and 84 per cent. of them are family-run businesses, which adds a certain importance to them. I notice that the hon. Member for Selby (Mr. Grogan), chairman of the all-party beer group, is here; I paid tribute to it a moment ago.
	Pubs are extremely valuable to communities; they act as meeting places and many friendships are formed in them. Many groups are set up through pubspub football teams and golf societies, for example. Fairly recently I managed to win the tournament put on by my local golf society. I was very proud of that.

Nigel Evans: Did anybody else enter?

Laurence Robertson: I can tell my hon. Friend that, yes, others did enter.
	Pubs play host to skittles matches, card games, dominos, darts and pool, as well as many other activities. They are headquarters for various societies, andeven more so these daysprovide meals for families and individuals. In fact, almost 40 per cent. of pubs' turnover comes from food sales. People watch sports in pubs and pubs provide supervised drinking, an important point to which I will return in a minute. Some provide wonderful examples of fine architecture and many raise money for charities. Furthermore, they are particularly, although not exclusively, important in rural areas. They have been described as a uniquely British institution.
	Pubs also make an important economic contribution, particularly through tax; according to the House of Commons Library, the drinks industry alone contributes 14.79 billion a year. Each pub contributes an average of about 90,000 in taxes, which is an awful lot of money. When we next go to our local pub, we should think about the 90,000 contributed just by that pub; we will then realise pubs' economic value to the country as well as to the community. At a time when people who enjoy a social drink are under pressure because of the misuse of alcohol by the few, we should remember how much money people who enjoy a drink contribute to the Exchequer.
	Some 350,000 people are directly employed by pubs, but a large number are also indirectly employed by them. On average, each pub contributes about 3,000 to charities in their areas. I pay tribute to all the landlords and landladies who have run such fine institutions over the years and provided such a great contribution to their communities.
	Alas, however, there are problems, and that is the main reason for my wanting to hold this debate. I am thinking particularly of pub closures. Pubs are closing at a rate of 39 every single week. That is bad enough, but an even bigger problem is that the rate is accelerating. Since the last Budget, more than 2,000 pubs have closed, costing the Government 180 million in lost revenue, with the loss of 20,000 jobsthat is a lot of jobs to lose. In my own constituency, 11 pubs have closed since June 2005, including one very recently that I really would not have expected to close. Of course, in some areas, where the market might be saturated, a few pub closures are to be expected now and again, but this trend represents more than that, and it is very worrying. I would suggest that there are other reasons for it apart from the economic downturn, which obviously is not helping any business. I will name just a few: high tax; competition with supermarkets; pubcos, which are the organisations that own the pubs; the weak pound, to some extent; and the smoking ban. All those problems have contributed; I should like to take each of them in turn.
	There are two worries as regards tax. It is sometimes difficult to get exact figures for tax on beer, but it seems that it accounts for 28 per cent. of the price of a pint in the pub. Over the years, the sale of beer has declined dramatically. Now there is the question of what the Chancellor of the Exchequer will do in a few weeks' time in his Budget. It is feared that the escalator that was imposed, which meant that beer duty would increase by the retail prices index plus 2 per cent., will create further problems for the pub industry. A while ago, VAT was reduced for almost all goods and services across the country, but that did not apply to drinksbeer, in particularbecause the duty was put up to ensure that the price of alcohol did not fall. The beer industry did not get any boost from that reduction in VATalthough I doubt that any industry did, as it was a futile measurebecause it, together with smoking, was singled out as an area that should not benefit. That is bad enough, but when VAT is restored to 17.5 per cent., it will face an even bigger increase because the duty was adjusted when the rate was reduced.
	I do not have anything against supermarkets, but there are two problems: first, their provision of very cheap alcohol, usually through using it as a loss-leader to get people into them in the first place; and secondly, their power of purchase, also used against farmers, which enables them to refuse to accept increases that breweries might feel the need to pass on to them, even when the tax paid by the brewery has gone up. All the people who buy from supermarkets then drink unsupervised. Pubs provide a supervised forum for drinking; supermarkets do not. Under-age people are oftennot always, by any meansable to get alcohol from supermarkets very cheaply and cause trouble in communities as a result. In pubs, tax forms about 28 per cent. of a pint of beer; in supermarkets, and in the off trade generally, it forms 50 per cent. That reflects the different prices that are charged. I am informed that in the 1990s the on-off ratiothe price in a pub compared with the price outside the pubwas 2:1; now, it is 7:1. The very cheap alcohol that is available in supermarkets has a big effect in terms of social behaviour, as well as on pubs.
	There is also the question of pubcos. Punch Taverns, Enterprise Inns and many other companies own pubs that were once owned by breweries. Bass, for example, which was a brewer but also a pub owner, had 7,190 pubs in 1989. In 2007, Punch Taverns had 9,095 pubs. The ownership of pubs is very different now. Why is that important? All four or five of us in the Chamber today realise that a monopolistic situation existsvertical integration might be a better way to describe it. The Select Committee on Business and Enterprise finished a report on that recently, but unfortunately it has not been publishedwe look forward to it. I am not against pubcos, but the fact that they act as a middleman, buying beer and then charging extra for providing it to pubs, which could get it directly from the breweries if they were not tied to the pubco, makes beer a lot more expensive for those who go into pubs. And we can see that the situation is worse for pubs when we compare their prices to those of supermarkets. I referred to my own pub, and Punch Taverns recently ordered a 10p a pint increase there because of the pressure it is subject to from breweries due to extra tax pressure, but it could add a bit more if it so wished. That said, only 14 per cent. of closures are of pubs owned by any of the top six pubcos; I am not saying that they do not do a good job in some cases, but I am highlighting a difficulty.
	I mentioned the weak pound. I do not want to say too much about that, but if we buy alcohol from abroad, it will be dearer. I now come to the smoking ban. I realise that this will be the most contentious part of my speech, but that has never worried me before. I spoke against the ban on smoking in public places, not because I do not respect the right of people to enjoy themselves in smoke-free environments, but because I felt that it was up to the local landlord to know his potential customers and decide what was best for them. There can be no doubt that beer sales have fallen. There may be a few extra people who come into pubs because they are smoke-freeI do not think that there are manybut we could have had high-quality extractor units and separate areas in pubs, and things could have been so much better. I do not mean this discourteously, but if people are fair-weather patrons of pubs, they do not spend much money. They are entitled to sit in the corner with an orange juice all nightthat is their privilege and I defend their right to do sobut that does not keep the pubs going. It is the more regular patrons, such as myself and many others, who provide more of the money.
	Another aspect of that problem relates to the supermarkets selling alcohol very cheaply. People might be persuaded to stay at home, drinking cheap and probably stronger alcohol in greater measures, while smoking in front of children. Previously they would have smoked in a pub in front of adults who had a choice of whether to be there or not. The ban has not helped in any respect.
	Rate relief and rural rate relief are helpful, but are seen as rather inadequate because qualifying levels are far too low. They are also discretionary and perhaps they should be mandatory. Business rates will increase by 5 per cent. in a few days' time across the board, including for pubs, even though that increase is based on September's retail prices index. I do not think there is an RPI at the momentI think that it is nilbut there will still be an increase, which seems unfair.

John Grogan: On the subject of rate relief, does the hon. Gentleman agree that there is a strong case for extending rate relief not just to village pubs, but to those in market towns and suburbs? Any pub that calls itself a community pub should be able to apply for such rate reliefsuch a measure might be of some assistance.

Laurence Robertson: I agree with the hon. Gentleman. That would help, although it would not entirely rescue the situation. We must consider the position of small businesses. They have to pay money out before they have earned any. That payment is not based on their activity, and they really are in a difficult situation. I hope that the Government will do something about that.

Nigel Evans: Does my hon. Friend agree that something else that disadvantages a lot of small pubs with high rateable values is the fact that they are unable to put on Sky Sports, and particularly some football matches, because the charges are so prohibitively large? That is another reason why people are staying at home. They watch football there, because they are unable to do so in a lot of pubs, particularly in rural areas.

Laurence Robertson: My hon. Friend is absolutely right. I have seen examples of that situation, which has a bad effect. My sister has a bar in Spain, and when there is a world cup tournament on, or cricket, football or whatever it is, the takings rise greatly. If that facility cannot be made available by pubs in this country, for the reasons that my hon. Friend gives, it is a setback.
	I suggest that there should be no increase in alcohol tax in the Budget. I know that the Government are looking to get back the billions of pounds that the Prime Minister has spent on rescuing failing banks and now on effectively printing money, but I think that an increase would be counter-productive. Oxford Economics estimates that an increase would cost a further 75,000 jobs over the next two years, which is a lot of jobs. Those people would then be unemployed, and the situation would get worse. The tax should be frozen. Actually, I would like it to be reduced, particularly on beer. I do not suppose that the Government will do that, but the situation is certainly becoming urgent when 39 pubs a week are closing. If people continue to turn away from pubs, it will be counter-productive from a health point of view because supermarkets will fill the void in a dangerous way.
	I was pleased to hear the Prime Minister say recently, when there was a suggestion of a minimum price per unit of alcohol, that other methods should be chosen to counter the problems that are related perhaps to alcohol, but more particularly to people's bad behaviour. That is what we should put them down to. Yes, the low price of alcohol is fuelling the problems in certain places, but we should not lose sight of the fact that it is people's bad behaviour that is causing them.
	We would like to see, as all small businesses would, an end to the drip-drip regulation that affects all businesses, but small ones disproportionately. We need to allow diversificationperhaps post offices could be put in pubsand we need a simplified planning system for smaller planning applications. I have said that mandatory rate relief should be considered, and there should not be any increase in business rates this year. As I said, the inflation figure is now nil anyway.
	I stand to be corrected, but I understand that the Government have not yet responded to the excellent report on the community pub inquiry produced by my hon. Friend and his team. Perhaps they could respond to the excellent suggestions in it. I look forward to hearing what the Minister has to say, and I thank him again for attending. Pubs are well worth saving, for the reasons that I have giventheir economic value and their value to the community. To pinch a quotation from my hon. Friend's excellent report, the writer and one-time MP Hilaire Belloc said:
	When you have lost your inns, drown your empty selves, for you will have lost the last of England.
	I think he had it about right.

Gerry Sutcliffe: I am delighted to respond to the hon. Member for Tewkesbury (Mr. Robertson) and grateful that he has had the opportunity to discuss the future of pubs. I am also pleased to see the hon. Member for Ribble Valley (Mr. Evans) and my hon. Friend the Member for Selby (Mr. Grogan) in their places. I believe that they are all members of the all-party beer group and active participants in the beauty of drinking alcohol responsibly.
	This is an important debate, and part of a continuing one. The hon. Member for Tewkesbury mentioned the all-party group's report, to which I want to respond very shortly. He will know that a number of Departments are involved in that response, and I shall co-ordinate it because the Department for Culture, Media and Sport is, I hope, the champion of the licensing industry. He referred to the fact that I enjoy the odd tipplein fact, he knows that I am a keen pub goer and was pleased to support the Proud of Pubs week last year. I pay tribute to Phil, the landlord, Jenny, his wife, and the excellent staff of my local pub, The Glen in Gilstead. I look forward to their excellent service this weekend, when I hope to be there.
	It was good to see so many parliamentarians attending the recent summit arranged in the House by the all-party beer group. It was clear from the excellent turnout ranging across MPs, Ministers, the industry and licensees, and from the quality of the debate, that there was concern about the role of pubs and their importance to our constituents. I and my ministerial colleagues recognise that the pub industry faces difficult times, and we want to address the issues and recommendations raised. The hon. Gentleman is right to say that the number of pubs closing is alarming, and that the number of jobs lost and the impact on the economy are serious issues.
	I understand some of the frustrations of the pub sector with what it sees as the cumulative impact of Government measures, but those alone are not the cause of pub closures, as was identified in the excellent debatethe hon. Gentleman raised some of the issues in that regard. We need to consider the role of tied houses and other pub companies, which, through differential pricing and the rents charged, have an impact on landlords. Although I understand the issues in relation to duty and regulation, I will discuss with colleagues in the Department for Business, Enterprise and Regulatory Reform how we can better understand the sector and provide help.
	The ideas about the role that community pubs can play are excellent. The hon. Gentleman gave examples of what goes on in pubs, whether sport, which is important to me, as the Sports Minister, or other activities. In a rural setting, the pub is important in providing services to the local community. We need to consider those matters.
	Although we take seriously the concerns expressed by the trade about many issues, I am afraid that I disagree with the hon. Gentleman about the smoke-free legislation, which is and should be a benefit to pubs. Given my role before I became an MP, he will not be surprised that workers' rights and public health are close to my heart. I believe that the restrictions introduced were the right way forward. A number of pubs have come up with ingenious solutions, in consultation with local authorities, to enable them to accommodate smokers. The debate will rumble on, but the majority of people backed our efforts.
	The hon. Gentleman was right to talk about responsible and supervised, as opposed to irresponsible, drinking. He will be concerned, as I am and many responsible pub owners are, about alcohol-related crime and disorder, and the need to treat and deal with those who cannot handle drink and commit crime as a result. In many cases, customers are put off going to pubs in town centres, for example, because of the violence that takes place. We want to see the growth of community pubs, but we must acknowledge the wider public intentions of policy to tackle such problems. We want to achieve a balance.
	I will respond to the all-party beer group, whose inquiry was important and dealt with well. I was pleased to give evidence to it, and it came up with a range of recommendations based on detailed consideration of the views of a variety of witnesses. I assure the hon. Gentleman that the Government will give a response soon, although it would be wrong to say exactly what it will be. Whatever the group feels about the outcome, I want to ensure that the message gets through that Ministers are aware of the current campaign and that the concerns are being heard.
	We have taken some measures, such as the decision to extend the enterprise credit guarantee scheme to all types of smaller pubs, which has helped many tied pubs in particular. In relation to legislation for which I am responsible in the Department for Culture, Media and Sport, I have placed orders before the House that would introduce a simpler process for making minor variations to licences, and to increase the stakes and prizes for pub gaming machines. Previously, I have also committed myself to measures to improve other aspects of the licensing regime. We will reflect on the issues raised by the hon. Gentleman today.
	Although the measures that we can take are important, they will not in themselves secure the viability of the trade or ensure that it can see out the economic downturn. How, then, should the pub trade help itself to respond to the challenges? The hon. Gentleman has already offered some solutions, but let me repeat that, in my view, community pubs could have a bright future.
	The issues raised by the hon. Gentleman were reflected in a recent seminar conducted by the Institute for Public Policy Research, which presented all sides of the argument. I was particularly pleased to hear a representative of Alcohol Concern say that the idea of community pubs service was a good one. The debate about alcohol-related health problems has sometimes featured the argument that those who are concerned about them do not understand the issues surrounding pubs, but Alcohol Concern was clearly prepared to support community pubs because they promoted responsible drinking. I consider that to be a major breakthrough. It is possible that pubs could become community businesses. I know that my colleagues in the Department for Communities and Local Government are discussing the possibility that rate support and other support could be given to pubs.
	Pubs have a great record of reinventing themselves and adjusting to changing demandsby offering better food, as many now do, or by offering more family-friendly premises. Sunday afternoon satellite television is important in securing the football market. I note what was said about that by the hon. Member for Ribble Valley. We must get that right. We speak of the decade of sport and the need to persuade more people to participate in sport. People want to see their role models on television, particularly footballers. We need to speak to representatives of Sky and Setanta, and similar providers, to see what they can do for the smaller pubfor pubs that are not part of a big chain that can afford the fee. I undertake to ensure that we at least talk to them about the possibility. The hon. Gentleman will be aware of the wider review of issues related to sport shown on terrestrial television, in which my hon. Friend the Member for Selby is heavily involved, but I think that he made a fair point.
	The editor of the  Morning Advertiser wrote in June last year that some of the current challenges had accelerated the decline in pubs that could not adapt to modern demands. That loss is sad, but we must ensure that we provide an opportunity for the pubs that remain to emerge successfully from the present downturn. I believe that that can be done if we adopt a positive attitude. Yes, there are issues to which the Government should respond with tax-related and other measures, although they should be seen in the round and in the context of all the other spending issues with which Government are faced.
	Given that the all-party beer group is the largest group in Parliament, it is perhaps surprising that only five of us are present this afternoon. However, I am sure that the group's other members will be watching our debate avidly on television, back in their constituencies, to see what I have to say about the outcome for pubs.

Nigel Evans: On their pub televisions.

Gerry Sutcliffe: On their pub televisions, yes. Certainly the group is concerned about the impact of what is happening.
	The pub is a traditional part of life here in the United Kingdom, and we must do what we can to ensure that it continues. Pubs face many challenges, but I think we are all united in wanting to advance consistent arguments in favour of enabling as many as possible to survive.
	Drinking habits are an issue. Social changes are taking place: people are turning from beer to wine, and more drinking takes place at home. Let me make a point now in case I am challenged on the matter in future. What we are talking about is responsible drinking, supervised drinking, and ensuring that people drink reasonably in a safe environment.
	I undertake to deal with as many as possible of the points made by the hon. Member for Tewkesbury when I respond to the all-party group. I am grateful to him for raising the issue this evening.
	 Question put and agreed to.
	 House adjourned.